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Southwest AirlinesLUVTOP PICKMay 21, 2015Stock price when the opinion was issued
As of Jun 18, 2026. Market Open.
Sure, there's a travel boom, but the airlines haven't fully benefit due to major unreliability problems. For example, LUV cancelled 16,000 flights over the holidays last year due to bad weather and technical issues. Just last week, technical problems led to nationwide delays. Pity, because LUV has long held a good reputation, and he likes Southwest.
It's the best-run American Airlines with the best routes. It's been beaten up, so pick up shares. FDA full approval of Pfizer's Covid vaccine will help.
Several airlines qualify for the reopening play, but LUV boasts a CEO is smart to nail down new routes now. American Airlines is great, too, but not its balance sheet. LUV also benefits from the oil patch getting better.
This, along with the other airlines, dropped about 8%-10% yesterday, based on concerns about capacity and pricing pressures based on too much competition. That was well overdone. It oversold down to the 200 day moving average. All revenues are US domestic, so you don’t have to worry about the US$ tailwinds. Very healthy balance sheet. Dividend yield of 0.81%.