Expedia Channel And Premium Seating Will Boost Operational Efficiency
The consensus price target for Southwest Airlines has increased as stronger revenue growth forecasts more than offset the impact of a higher discount rate, lifting fair value estimates to $30.82.
What's in the News
- Board authorizes new $2 billion share repurchase program; 72.97 million shares (12.6%) already repurchased for $2.36 billion under prior program.
- Q2 2025 results show declines in passenger metrics and load factors year-over-year; load factor decreased to 78.5% from 82.6%.
- Q3 2025 guidance anticipates unit revenues between -2% and +2% on flat capacity, with full-year 2025 EBIT projected at $600–$800 million.
- Announced $8 million in impairment charges for Q2 2025.
- Expanding network with new St. Thomas service (USVI) in early 2026, launch of assigned/premium seating, new fare bundles, and reconfigured fleet.
- Entered discussions with China Airlines for interline partnership and expanded Icelandair partnership for additional transatlantic connections.
- Opened expanded cargo facility and additional infrastructure at Denver International Airport to support growing operations.
- Added to multiple Russell Growth Indexes, including Russell 1000, 3000, Midcap, and 3000E Growth.
Valuation Changes
Summary of Valuation Changes for Southwest Airlines
- The Consensus Analyst Price Target has risen from $28.39 to $30.82.
- The Discount Rate for Southwest Airlines has significantly risen from 7.71% to 9.86%.
- The Consensus Revenue Growth forecasts for Southwest Airlines has significantly risen from 5.2% per annum to 6.0% per annum.
Disclaimer
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