Understanding Why Southwest Airlines Company Stock Is Moving Up Today.

One of the standouts of today's morning trading session was Southwest Airlines Company, which logged a 2.2% performance and outperformed the S&P 500 by 2.2%. The Airlines stock is now trading at $39.49 per share and may still have upside potential because it is still -19.95% under its average target price of $49.33. Analysts have set target prices ranging from $39 to $66 dollars per share, and have given the stock an average rating of buy.

The market seems to share this optimistic view, since Southwest Airlines Company has a short interest of only 1.9% (this is the percentage of the share float that is being shorted). Each short position represents an investor's expectation that the price of the stock will decrease in the future.

Another way to gauge the sentiment on Southwest Airlines Company is to look at the percentage of institutions that are invested in the stock. In this case, 76.0% of the shares are held by pension, mutual, and hedge funds, which shows that these institutions probably have strong confidence in the stock.

Overall, there is mostly positive market sentiment on Southwest Airlines Company because of its an analyst consensus of some upside potential, a buy rating, a very low short interest, and an average number of institutional investors. Warren Buffett famously said that in the short term, markets are voting mechanisms, but in the long term, they are weighing mechanisms. This means that long term investors should be aware of a stock's fundamentals before committing.

Buffett was one of the fist investors to focus on free cash flow as a yardstick for a company's health. Here are LUV's recent cash flows:

Date Reported Cash Flow from Operations ($) Capital expenditures ($) Free Cash Flow ($) YoY Growth (%)
2021-12-31 2,322,000,000.0 -511,000,000.0 1,811,000,000.0 210.29
2020-12-31 -1,127,000,000.0 -515,000,000.0 -1,642,000,000.0 -155.47
2019-12-31 3,987,000,000.0 -1,027,000,000.0 2,960,000,000.0 1.47
2018-12-31 4,893,000,000.0 -1,976,000,000.0 2,917,000,000.0 n/a
The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.