Southwest Airlines (LUV) Stock: Buy, Sell, or Hold?
LUV - Southwest Airlines Co.
$40.98
0.64 (1.59%)
â˛
5d:
+4.43%
30d:
-1.06%
90d:
-14.57%
WAIT
LOW Confidence
Analysis Updated: Sep 18, 2026 12:00 AM ET
Earnings: Oct 28, 2026
Smart Money Distribution
Options positioning is turning defensive after a sharp run-up - a pattern consistent with institutional profit-taking. View Scanner →
Signal fired Sep 18, 2026 at $40.98 · last confirmed Sep 18, 2026
Strength: 7.7/10
Get Alerted When LUV Hits Your Target Price
Join 10,000+ traders who never miss a move
You're in! Check your email to confirm and set your target price.
100% Free
No spam, ever
Unsubscribe anytime
Interactive Price Chart (1 Month)
Loading chart...
Loading historical data...
Bottom Line:
âšī¸ NEUTRAL: LUV is fairly priced but lacks strong directional signals. At -5.2% expected growth, valuation appears cheap. Wait for clearer setup or better entry on dips.
âšī¸ NEUTRAL: LUV is fairly priced but lacks strong directional signals. At -5.2% expected growth, valuation appears cheap. Wait for clearer setup or better entry on dips.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$93.91
Based on 14.5% avg growth
INTRINSIC VALUE TODAY
$58.31
29.7% 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 10.3x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: LUV is currently trading at $40.98, which is considered fair relative to its 30-day fair value range of $38.49 to $42.98. From a valuation perspective, the stock is trading at a discount (Forward PE: 8.8) compared to its historical average (10.3). Remarkably, the market is currently pricing in an annual earnings decline of 5.2% over the next few years. This pessimistic expectation contrasts with the company's recent 20.5% earnings growth, suggesting potential undervaluation if the company simply maintains stability.
Technical Outlook: Technically, LUV is in a downtrend. The price is approaching resistance at $41.34. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation.
Market Sentiment: The stock scores a mixed 50/100 on our bottoming-setup gauge, with only partial signs of a stabilized entry point. Wall Street analysts see significant upside, with an average price target of $49.83 (+21.6%). Current signals suggest waiting for a better entry point before initiating new positions.
Technical Outlook: Technically, LUV is in a downtrend. The price is approaching resistance at $41.34. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation.
Market Sentiment: The stock scores a mixed 50/100 on our bottoming-setup gauge, with only partial signs of a stabilized entry point. Wall Street analysts see significant upside, with an average price target of $49.83 (+21.6%). Current signals suggest waiting for a better entry point before initiating new positions.
Quick Decision Summary
Current Position
FAIR
Historical Trading Range
$38.49 -
$42.98
Company Quality Score
53/100
(HOLD)
Volume Confirmation
HIGH
Confidence Score
72.4%
Protect Your Profits
Holding LUV? Use our AI-powered strategies to protect your downside while keeping your long-term position.
View Profit Protection PlanAll Signals
- NEUTRAL: Price in fair range
- NEUTRAL: Mixed technical signals (50/100)
- BULLISH: High volume confirmation
- BULLISH: Trading 21.6% below Wall St target ($49.83)
- WARNING: Composite score 52/100 in the bottom quintile â this cohort historically lags the market
Trading Range Analysis
30-Day Trading Range
$38.49 -
$42.98
Current vs Trading Range
FAIR
Support & Resistance Levels
Support Level
$37.75
Resistance Level
$41.34
Current Trend
Downtrend
Technical data as of
Sep 18, 2026
Fundamental Context
Forward P/E (Next Year Est.)
8.75
Wall Street Target
$49.83
(+21.6%)
Revenue Growth (YoY)
16.4%
Earnings Growth (YoY)
20.5%
Profit Margin
2.8%
Valuation Discount vs History
-5.2% cheaper
PE vs Historical
8.8 vs 10.3
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-5.2%
(market-implied from PE analysis)
1-Year Target
$38.85
(-5%)
2-Year Target
$36.83
(-10%)
3-Year Target
$34.91
(-15%)
3-Yr Target (if PE normalizes)
(PE: 9â10)
$41.09
(+0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 20.2, Growth: 44.6%)
$285.95
(+598%)
Base:
(SPY PE: 8.8, Growth: 44.6%)
$123.90
(+202%)
Bear:
(PE: 7.4, Growth: 44.6%)
$105.32
(+157%)
đ
Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (25x PE), but valuation improves significantly next year (9x PE) as earnings recover.
Trailing PE: 25.21 | Current EPS (TTM): $1.60
Bull Case
$88.75
(+117%)
Analyst growth 100.0%, PE expands to 27.7
Base Case
$80.68
(+97%)
Market implied 100.0%, PE stable at 25.2
Bear Case
$27.43
(-33%)
Severe decline -20.0%, PE contracts to 21.4
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
đĄ
Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 8.8 to 10.3
Stabilization Target:
$48.22
(+17.7%)
PE Expansion Potential:
+17.7%
Share & Embed Analysis
Last updated: September 20, 2026 6:50 PM ET
Data refreshes hourly during market hours. Next update: 7:50 PM
Data refreshes hourly during market hours. Next update: 7:50 PM
đĨ Top Stocks Breaking Out Now
| Ticker | Score | Recommendation | Change % |
|---|
Technical Signals Check
Is LUV showing a specific setup today?
Insider Activity (6 Months)
0
Buys
1
Sells
Net
INSIDERS SELLING
Recent Transactions
Lisa M Atherton
SELL
118 shares
2026-04-07
Top Rated Airlines Stocks
Top-rated stocks in Airlines by analyst ratings.
| Stock | Analyst Consensus | Analyst Target | Tradestie Score |
|---|---|---|---|
|
UAL
United Airlines HoldingsâĻ |
STRONG BUY
25 analysts |
$158 | 71 BUY |
|
DAL
Delta Air Lines Inc |
STRONG BUY
24 analysts |
$103 | 68 BUY |
|
AAL
American Airlines Group |
BUY
26 analysts |
$18 | 68 BUY |
|
ALK
Alaska Air Group Inc |
STRONG BUY
16 analysts |
$58 | 65 BUY |
|
CPA
Copa Holdings SA |
STRONG BUY
15 analysts |
$179 | 65 BUY |
Advanced LUV Option Strategies
Professional options setups generated by AI based on today's LUV price and gamma walls.
