Southwest Airlines Stock: Analyst Estimates & Ratings

Valued at a market cap of $18.6 billion, Southwest Airlines Co. (LUV) is one of the largest domestic airlines in the United States, providing scheduled passenger air transportation to more than 100 destinations across the U.S. and select international markets, including Mexico, the Caribbean, and Central America. Headquartered in Dallas, Texas, Southwest is known for its low-cost business model, point-to-point route network, and customer-friendly service.

After a turbulent period for the airline industry, Southwest Airlines has staged an impressive comeback. Shares of LUV have surged 42.7% over this time frame, while the broader S&P 500 Index ($SPX) has gained 14.8%. Moreover, on a YTD basis, the stock is up 7.4%, outpacing SPX’s 6.9% rise.

Zooming in further, LUV has outpaced the U.S. Global Jets ETF (JETS), which soared 27.7% over the past 52 weeks. 

On Jul. 22, Southwest Airlines delivered a solid FY2026 Q2 report, but investors looked past the headline beat. The carrier reported record operating revenue of $8.43 billion, up 16.4% year over year, the highest in company history, while adjusted EPS came in at $0.94. Despite absorbing $889 million in additional fuel costs from the prior year, Southwest's adjusted unit revenue surged 20.1%, exceeding its prior guidance and underscoring the early success of its commercial transformation initiatives.

However, the stock fell 2.1% after the earnings release as a weaker-than-expected outlook overshadowed the impressive quarter. Management warned that persistently high fuel prices would continue to weigh on profitability, forecasting third-quarter adjusted EPS of $0.50 to $0.75, well below Wall Street's $0.82 estimate. The airline also replaced its previous full-year earnings guidance of at least $4 per share with a range of $3.25 to $4.25, signaling that elevated fuel costs could dampen the earnings benefits of its ongoing revenue initiatives.

For the current fiscal year, ending in December, analysts expect LUV’s EPS to grow 278.5% year over year to $3.52. The company’s earnings surprise history is solid. It met or exceeded the consensus estimates in each of the last four quarters. 

Among the 23 analysts covering the stock, the consensus rating is a “Moderate Buy,” which is based on 10 “Strong Buy,” one "Moderate Buy,” eight “Hold,” one "Moderate Sell,” and three “Strong Sell” ratings.  

On Jul. 24, BMO Capital Markets raised its price target on Southwest Airlines to $60 from $58.50 and reiterated its "Outperform" rating after the carrier reported stronger-than-expected second-quarter results. 

The mean price target of $53.48 indicates a 20.5% potential upside from the current levels, while its Street-high price target of $67 suggests a 51% potential upside from the current levels.