Zacks Research Issues Optimistic Outlook for LUV Earnings

Posted by Geri Gentry on Aug 7th, 2026

Southwest Airlines Co. (NYSE:LUV – Free Report) – Research analysts at Zacks Research increased their Q3 2026 EPS estimates for Southwest Airlines in a research note issued to investors on Wednesday, August 5th. Zacks Research analyst Team now forecasts that the airline will earn $0.73 per share for the quarter, up from their previous estimate of $0.58. Zacks Research currently has a “Hold” rating on the stock. The consensus estimate for Southwest Airlines’ current full-year earnings is $3.47 per share. Zacks Research also issued estimates for Southwest Airlines’ Q4 2026 earnings at $1.16 EPS, FY2026 earnings at $3.29 EPS, Q4 2027 earnings at $1.96 EPS and FY2027 earnings at $4.96 EPS.

A number of other brokerages have also issued reports on LUV. Bank of America lifted their target price on Southwest Airlines from $40.00 to $45.00 and gave the stock an “underperform” rating in a research report on Wednesday, July 1st. The Goldman Sachs Group raised their price objective on Southwest Airlines from $30.00 to $35.00 and gave the company a “sell” rating in a research note on Thursday, July 2nd. UBS Group lifted their price objective on Southwest Airlines from $53.00 to $61.00 and gave the stock a “buy” rating in a report on Tuesday, June 23rd. HSBC raised Southwest Airlines from a “reduce” rating to a “hold” rating and upped their target price for the company from $24.40 to $36.10 in a research report on Friday, April 24th. Finally, BNP Paribas Exane raised their price target on shares of Southwest Airlines from $24.00 to $33.00 and gave the stock an “underperform” rating in a research report on Tuesday, April 21st. Nine equities research analysts have rated the stock with a Buy rating, nine have issued a Hold rating and four have issued a Sell rating to the company. Based on data from MarketBeat.com, Southwest Airlines currently has an average rating of “Hold” and an average target price of $49.55.

View Our Latest Stock Report on LUV

Southwest Airlines Stock Performance

NYSE:LUV opened at $46.93 on Friday. The firm has a 50-day moving average of $47.04 and a two-hundred day moving average of $44.52. The company has a debt-to-equity ratio of 0.54, a current ratio of 0.49 and a quick ratio of 0.42. The stock has a market cap of $22.96 billion, a P/E ratio of 28.79, a PEG ratio of 0.43 and a beta of 1.14. Southwest Airlines has a 1-year low of $28.98 and a 1-year high of $55.11.

Southwest Airlines (NYSE:LUV – Get Free Report) last released its quarterly earnings results on Wednesday, July 22nd. The airline reported $0.94 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.52 by $0.42. Southwest Airlines had a net margin of 2.78% and a return on equity of 14.15%. The firm had revenue of $8.72 billion for the quarter, compared to the consensus estimate of $8.58 billion. During the same quarter in the previous year, the firm posted $0.43 EPS. The firm’s quarterly revenue was up 16.4% on a year-over-year basis. Southwest Airlines has set its FY 2026 guidance at 3.250-4.250 EPS and its Q3 2026 guidance at 0.500-0.750 EPS.

Institutional Trading of Southwest Airlines

Hedge funds and other institutional investors have recently bought and sold shares of the company. AQR Capital Management LLC lifted its holdings in Southwest Airlines by 100.6% during the 1st quarter. AQR Capital Management LLC now owns 39,347 shares of the airline’s stock worth $1,303,000 after buying an additional 19,729 shares during the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its position in shares of Southwest Airlines by 5.4% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 61,060 shares of the airline’s stock worth $2,050,000 after acquiring an additional 3,141 shares in the last quarter. Empowered Funds LLC increased its holdings in shares of Southwest Airlines by 7.6% in the 1st quarter. Empowered Funds LLC now owns 7,459 shares of the airline’s stock valued at $250,000 after acquiring an additional 527 shares during the last quarter. EverSource Wealth Advisors LLC increased its holdings in shares of Southwest Airlines by 73.4% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 5,690 shares of the airline’s stock valued at $185,000 after acquiring an additional 2,408 shares during the last quarter. Finally, First Trust Advisors LP raised its position in shares of Southwest Airlines by 47.4% during the 2nd quarter. First Trust Advisors LP now owns 307,602 shares of the airline’s stock valued at $9,979,000 after acquiring an additional 98,986 shares in the last quarter. 80.82% of the stock is owned by institutional investors.

Southwest Airlines Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Thursday, September 24th. Investors of record on Thursday, September 3rd will be paid a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a yield of 1.5%. The ex-dividend date is Thursday, September 3rd. Southwest Airlines’s dividend payout ratio (DPR) is 44.17%.

More Southwest Airlines News

Here are the key news stories impacting Southwest Airlines this week:

Positive Sentiment: Lower oil prices could benefit airlines by reducing jet-fuel expenses and supporting profitability if the decline persists. Oil Just Lost its Inflation Premium: Here’s Who Wins if Prices Stay Low
Positive Sentiment: Southwest is promoting a new business-traveler offering, which could help increase corporate demand and diversify revenue beyond leisure travel. Southwest Airlines is courting business travelers with a new offering
Positive Sentiment: Boeing’s FAA certification of the 737 Max 7 clears a regulatory hurdle for the aircraft. Future deliveries could give Southwest additional fleet flexibility and support capacity growth, although passenger service is not expected until 2027. Boeing’s Smallest 737 Max Finally Wins FAA Certification
Neutral Sentiment: Southwest’s limited-time $5 companion promotion offers unlimited use on qualifying flights during the first two months of next year. The campaign may stimulate bookings and customer engagement, but the heavy discount could also weigh on fares and revenue per passenger. Southwest Airlines will let you bring along a friend for just $5
Neutral Sentiment: Southwest has continued updating its extra-seat policy, including complimentary additional seats for eligible passengers. The change may improve customer experience but has uncertain financial implications. Southwest’s extra-seat policy has changed
Negative Sentiment: Zacks Research made mixed revisions to Southwest’s longer-term outlook: Q1 2027 EPS rose to $0.81 from $0.66, Q3 2027 increased to $1.04 from $1.01, and FY2028 rose to $5.83 from $5.70. However, Q2 2027 fell to $1.16 from $1.22 and Q2 2028 edged down to $1.29 from $1.30. Zacks maintained a Hold rating, limiting the bullish impact.

Southwest Airlines Company Profile

(Get Free Report)

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest’s operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.