LUV Stock Analysis: Buy, Sell, or Hold?
LUV - Southwest Airlines Co.
$51.06
1.65 (3.33%)
▲
5d:
+7.64%
30d:
+24.95%
90d:
+28.18%
HOLD
MODERATE Confidence
Analysis Updated: Jun 23, 2026 12:00 AM ET
Earnings: Jul 22, 2026
27d
Smart Money Distribution
None View Scanner →
Strength: 9.0/10
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Interactive Price Chart (1 Month)
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Bottom Line:
📊 HOLD - EXTENDED: LUV is 9.0% above its trading range ($46.85). Fundamentals are solid but entry is stretched. Hold existing positions; wait for pullback to add new shares.
📊 HOLD - EXTENDED: LUV is 9.0% above its trading range ($46.85). Fundamentals are solid but entry is stretched. Hold existing positions; wait for pullback to add new shares.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$93.46
Based on 14.5% avg growth
INTRINSIC VALUE TODAY
$58.03
12.0% Margin of Safety
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 10.6x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: LUV is currently trading at $51.05, which is considered extended relative to its 30-day fair value range of $40.11 to $46.85. The stock's valuation (Forward PE: 10.9) is in line with its historical norms (10.6). At these levels, the market is pricing in 0.9% annual earnings growth. This growth rate appears achievable given the company's track record, suggesting the valuation is rational.
Technical Outlook: Technically, LUV is in a downtrend. The price is approaching resistance at $44.44. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation. The stock is showing strong short-term momentum, up 3.3% recently.
Market Sentiment: LUV has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. The stock is fairly positioned - fine to hold existing positions or accumulate slowly on dips, but not an urgent buy.
Technical Outlook: Technically, LUV is in a downtrend. The price is approaching resistance at $44.44. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation. The stock is showing strong short-term momentum, up 3.3% recently.
Market Sentiment: LUV has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. The stock is fairly positioned - fine to hold existing positions or accumulate slowly on dips, but not an urgent buy.
Quick Decision Summary
Current Position
EXTENDED
Historical Trading Range
$40.11 -
$46.85
Company Quality Score
58/100
(HOLD)
Volume Confirmation
HIGH
Confidence Score
55.7%
Protect Your Profits
LUV is technically overbought (RSI 74). Consider hedging now to protect against a potential pullback while keeping your upside.
View Profit Protection PlanAll Signals
- BEARISH: Price extended above range (+9.0% above its trading range)
- BULLISH: Strong technical setup (60/100)
- BULLISH: High volume confirmation
- BULLISH: Strong upward momentum (+3.3%)
- BEARISH: Trading above Wall St target ($45.95)
- NEUTRAL: Market pricing in 0.9% annual earnings growth - fairly valued
Trading Range Analysis
30-Day Trading Range
$40.11 -
$46.85
Current vs Trading Range
EXTENDED
Support & Resistance Levels
Support Level
$40.82
Resistance Level
$44.44
Current Trend
Downtrend
Technical data as of
Jun 9, 2026
Fundamental Context
Forward P/E (Next Year Est.)
10.91
Wall Street Target
$45.95
(-7.0%)
Revenue Growth (YoY)
12.8%
Earnings Growth (YoY)
50.8%
Profit Margin
2.8%
Valuation Premium vs History
+0.9% premium
PE vs Historical
10.9 vs 10.6
FAIR
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
+0.9%
(market-implied from PE analysis)
1-Year Target
$49.85
(+1%)
2-Year Target
$50.30
(+2%)
3-Year Target
$50.76
(+3%)
3-Yr Target (if PE normalizes)
(PE: 11→11)
PE COMPRESSION
$49.30
(0%)
Earnings growth offset by PE compression
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 21.8, Growth: 64.8%)
$332.83
(+574%)
Base:
(SPY PE: 10.9, Growth: 64.8%)
$166.76
(+238%)
Bear:
(PE: 9.3, Growth: 64.8%)
$141.74
(+187%)
📈
Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (32x PE), but valuation improves significantly next year (11x PE) as earnings recover.
Trailing PE: 32.38 | Current EPS (TTM): $1.50
Bull Case
$106.85
(+116%)
Analyst growth 100.0%, PE expands to 35.6
Base Case
$97.14
(+97%)
Market implied 100.0%, PE stable at 32.4
Bear Case
$33.03
(-33%)
Severe decline -20.0%, PE contracts to 27.5
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
Share & Embed Analysis
Last updated: June 24, 2026 11:53 AM ET
Data refreshes hourly during market hours. Next update: 12:53 PM
Data refreshes hourly during market hours. Next update: 12:53 PM
🔥 Top Stocks Breaking Out Now
| Ticker | Score | Recommendation | Change % |
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Technical Signals Check
Is LUV showing a specific setup today?
Insider Activity (6 Months)
0
Buys
2
Sells
Net
INSIDERS SELLING
Recent Transactions
Lisa M Atherton
SELL
118 shares
2026-04-07
Ro Khanna
SELL
2026-02-06
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