Southwest Airlines Co.

Air Transportation, Scheduled

LUVMixed7 of 11 basics passed

$42.19

+2.01%

Market cap $20.6B

$42.19

+2.01%

Market cap $20.6B

Southwest Airlines is the largest domestic air carrier in the United States by passengers boarded. Southwest operates nearly 800 aircraft in an all-Boeing 737 fleet.

It is a $20.6B consumer company. Revenue grew 9.5% over the last year, it keeps 3¢ of every dollar of sales as profit, and it carries $1.67B of net debt. It trades at 24.3× earnings — near the lowest of its own history.

Website: southwest.com
Location: Dallas, TX
Employees: 73 456
Sector: Consumer Cyclical
Founded: 1967

Share price · 3 years

$26.65 → $42.19+58.3%

price only — dividends excluded

Key facts · TTM

Revenue: total sales; $30.1B
Profit: keeps 3¢ of every $1 sold; $837M
Free cash flow: cash left after running the business; -$457M
Net debt: debt minus cash on hand; $1.67B
P/E: years of profit in the price; 24.3
EPS: earnings per share, TTM; $1.50
Dividend: pays out 113% of profit; 2.86%
Shares: up 4% since 2019 — dilution; 558.2M
Volatility: beta vs the market — under 1 swings less; 1.23

Revenue, last 10 years

52-week range

Low $29.67$42.19High $54.80

Today's price is 50% of the way from the year's low to its high.

P/E vs its history5y

24.3×median 36.7×

Higher than 8% of past days — near the lowest of its own history.

Valuation vs own history

P/E

24.3×

92%

P/S

0.7×

72%

EV/EBITDA

24.0×

66%

P/B

2.9×

14%

FCF yield

3.6%

49%

Share of the last ~5 years that was pricier than today (in line with its own history). Based on the daily valuation record.

Standing in Consumer Cyclical

Size$20.6Btop 49%
Revenue growth+6%top 56%
Net margin3%top 79%
Return on equity11%top 74%
P/E24.3×top 62%
Dividend yield2.86%top 27%

Ranked against 99 Consumer Cyclical companies with a full CV — for P/E, lower ranks higher.

Skills

Six independent scores, 0–100, built from reported numbers and valuation history. Click a row to see how it was scored.

Growth, Profitability, Health and Moat lag behind.

Valuation70

P/E vs own history8th pct · 25/25
FCF yield-2.2% · 0/25
P/S0.7x · 25/25
EV/EBITDA12.2x · 20/25

Growth45

Revenue CAGR15.5% · 20/25
Net income CAGR-18.0% · 0/25
EPS CAGR ~5Yn/a · 0/25
Fwd implied growth146.0% · 25/25

Profitability28

ROIC4.6% · 5/25
ROE11.3% · 12/25
Net margin2.8% · 6/25
Operating margin3.5% · 5/25

Health48

Altman Z1.64 · 10/25
Current ratio0.49 · 0/25
Interest coverage9.3x · 18/25
Net cash / debtD/A 6% · 20/25

Quality59

Piotroski F7/9 · 22/25
Beneish M-3.50 · 25/25
FCF conversion-55% · 0/25
Margin stabilityσ 13.4% · 12/25

Moat18

ROIC >12% years6/10 yrs · 13/25
Median gross marginn/a · 0/25
FCF-positive years5/10 yrs · 5/25
Worst-year net marginworst -34.0% · 0/25

How the scores work →

Experience

The company's career so far — founding, the IPO, landmark products and acquisitions, plus revenue milestones and insider buying.

FY2018Financial
Became debt-free
cash now exceeds total debt
FY2017Financial
Best year on record
$3.49B net income
FY2016Financial
First recorded profitable year
$2.24B net income
FY2016Financial
Revenue already above $10B
$20.4B in first reported year
Mar 9, 1967Founded
The airline was established on March 9, 1967, by Herb Kelleher and Rollin King as Air Southwest Co

Achievements

Verifiable track record, straight from the reported numbers.

$10 000 invested in 2021 would be worth ~$8 784 today — price return only

$28.1B revenue in FY2025

Revenue up 9.5% year over year

Profitable 5 years in a row

73 456 employees

Strengths & watch-outs

What a bull and a bear would each point to. Both lists come from the reported numbers, not opinions.

Strengths

High gross margin (70.7%)
Interest covered 9.3× by operating earnings
Piotroski F-Score 7/9 — fundamentally strong checklist

Watch-outs

Negative free cash flow (-$457.0M)
Altman Z-Score 1.64 — elevated financial-distress risk
Loss-making in 1 of the recent years

Qualifications

The basics a company should meet before you research it further. Each check uses the reported numbers.

7 of 11 checks passed

Revenue growing — the company sells more than a year ago+9.5% YoY
Profitable — makes more than it spends$837M TTM
Profit growing — earnings are higher than last year-2.0% YoY
Generates cash — cash left after running and investing-$457M TTM
Debt under control — could handle its obligationscurrent ratio 0.49
Established company — not a micro-cap — lower blow-up risk$20.6B market cap
Not printing shares — share count not ballooning — you keep your slice-1.2% shares over ~5y
Proven track record — years of profitability behind it9/10 profitable years
Financially stable — balance sheet not near distressAltman Z 1.6 — distress
Pays a dividend — returns cash to shareholdersyield 2.86%
Valuation not extreme — price not wildly above earningsP/E 24.3

Peer comparisonSouthwest Airlines Co. vs 6 largest consumer cyclical peers — cap, P/E, growth and margin side by sideOpen ▾

Company	Market cap	P/E	Revenue growth	Net margin	Profile
LUV this company	$20.6B	24.3	+9.5%	2.8%	Mixed
AMZN Amazon.Com Inc	$2.8T	20.9	+15.8%	17.4%	Mixed
TSLA Tesla, Inc.	$1.5T	397.1	+11.8%	3.7%	Strong
NFLX NetFlix Inc	$292.8B	21.4	+16.0%	28.2%	Solid
HD Home Depot, Inc.	$290.4B	20.4	-16.0%	8.7%	Solid
DIS The Walt Disney Company	$186.5B	21.7	+4.6%	8.7%	Solid
MCD McDonald's Corporation	$166.9B	18.9	+6.3%	31.7%	Strained

Head-to-head: LUV vs AMZN · LUV vs TSLA · LUV vs NFLX

References

What covering analysts publish about the company — information only, not a recommendation.

Strong buy 2Buy 12Hold 12Sell 4

Appendix · Financial records

The full statements behind this CV, FY2016–FY2025. For readers who want to check the numbers.

Profit & lossRevenue $30.1B · net income $837M (TTM)Open ▾

Profit & loss

Revenue and profit over the company's career — the income statement, visualised.

RevenueNet income

Revenue (TTM)

$30.1B

YoY 9.5%

Net income (TTM)

$837M

Margin 2.8%

Gross margin

70.7%

Operating margin

3.5%

P/E ratio

24.3

Dividend yield

2.86%

Income statement — full detail

Figures in USD billions · EPS in USD

	2020	2021	2022	2023	2024	2025
Revenue	9.0	15.8	23.8	26.1	27.5	28.1
Gross profit	—	—	—	—	—	—
Operating income (EBIT)	-3.8	1.7	1.0	0.2	0.3	0.4
Net income	-3.1	1.0	0.5	0.5	0.5	0.4
EPS (diluted)	-5.44	1.61	0.87	0.76	0.76	0.79

Cash flowFree cash flow -$457M · operating cash flow $2.53B (TTM)Open ▾

Cash flow statement

Cash generated by the business and what is left after investment — year by year.

Operating cash flowFree cash flow

Free cash flow (TTM)

-$457M

Margin -1.5%

Operating cash flow (TTM)

$2.53B

FCF margin

-1.5%

Cash flow statement — full detail

Figures in USD billions

	2020	2021	2022	2023	2024	2025
Operating cash flow	-1.1	2.3	3.8	3.2	0.5	1.8
Capital expenditure	-0.5	-0.5	-3.9	-3.5	-2.1	-2.7
Free cash flow	-1.6	1.8	-0.1	-0.4	-1.6	-0.8
FCF margin	-18.1%	11.5%	-0.6%	-1.4%	-5.8%	-3.0%

Balance sheetAssets $29.1B · net debt $1.67B (FY2025)Open ▾

Balance sheet

How the balance sheet is built — what it owns versus how it is financed.

How $29.1B of assets is financed

73%

27%

Liabilities $21.1B — borrowed moneyEquity $7.98B — owners' stake

Cash vs debt

Total debt $4.90B − cash $3.23B = net debt $1.67B

Cash on hand covers 66% of debt.

Altman Z-Score

1.64

Distress zone

Interest coverage

9.3x

EBIT ÷ interest expense

ROE

11.3%

Profit per $1 of equity

Balance sheet — full detail

Figures in USD billions

	2020	2021	2022	2023	2024	2025
Cash & equivalents	13.3	15.5	12.3	11.5	8.7	3.2
Total assets	34.6	36.3	35.4	36.5	33.8	29.1
Total liabilities	25.7	25.9	24.7	26.0	23.4	21.1
Total debt	10.3	10.7	8.1	8.0	6.7	4.9
Equity	8.9	10.4	10.7	10.5	10.3	8.0
Net debt	-3.0	-4.8	-4.2	-3.5	-2.0	1.7

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Figures are derived from company filings (quarterly values normalised from as-filed year-to-date data where applicable) and may be delayed, restated or incomplete. This page is information, not investment advice. Latest price $42.19 · market cap $20.6B.