Southwest Airlines Company

The company operates as a passenger airline providing scheduled air transportation services. It operates a total fleet of 817 Boeing 737 aircraft. The company serves 121 destinations across the US, DC, Puerto Rico, and near-international countries. It offers inflight entertainment and connectivity on Wi-Fi enabled aircraft. Southwest provides loyalty program rewards points for dollars spent on base fares. Ancillary services include EarlyBird Check-In, upgraded boarding, pet transportation, and unaccompanied minors travel. The company was incorporated in 1967 and is headquartered in Dallas, Texas.

Overview

Sector

Airlines

Target Price

25.9 USD

Current Price

37.1 USD

Potential

-30%

Strengths

Price to book ratio (2.14) is lower than the sector mean (11.73).
EV/EBITDA (8.62) is lower than the sector mean (43.51).

Weaknesses

With a depreciation Potential of -30.60%, based on our fundamental analysis, it suggests the stock may be overvalued.
The company has high debt. Net Debt to EBITDA Ratio (100.00) is higher than the sector mean.
The company have lower returns than the sector in which it operates. ROIC (2.71%) is significantly lower than the sector mean (14.00%).
The Price to Free Cash Flow ratio (100.00) is significantly higher than the sector mean.
EBITDA Margin (9.84%) appears relatively low.

Key Financial Data

Indicator	Value
PER	47.4
EV/EBITDA	8.6
Price/Free Cash Flow'	100.0
ROIC	2.7%
Net Debt/EBITDA	100.0