Southwest Airlines Co (NYSE:LUV) a Buy: Merrill Lynch

In a research note issued to investors, Andrew Didora at Merrill Lynch Assigned their rating on Southwest Airlines Co (NYSE:LUV) to a Buy. The analyst placed a $52.00 price target on the stock which indicates a 17.70% upside to the last closing price. In the year following Andrew’s ratings, the stocks covered yield an average return of -3.2% according to TipRanks.com. In the past year 3 out of 7 recommendations or 43% were successful.

Southwest Airlines Co (NYSE:LUV) shares opened the most recent trading session at 43.63 and at the time of writing the last Bid was at 44.22. In the current trading session the stock reached as high as 44.29 and dipped down to 43.40. Southwest Airline, a NYSE listed company, has a current market cap of 29.913B and on average over the past 3 months has seen 8760440 shares trade hands on a daily basis.

On a technical level the stock has a 50 Day Moving Average of 43.0024. Based on a recent trade, this puts the equity at +2.90% away from that average. In comparing the stock’s current level to its extended history, the stock is trading -6.19% away from it’s 52-week high of 47.17 and +104.77% away from the stock’s low point over the past 52 weeks, which was 21.61. On a consensus basis, analysts have a one year target price of 55.63. The company last reported earnings per share of 1.638.

The consensus analyst estimates according to First Call for the next quarter is 1.10. The current year EPS estimate on the stock is 3.51 and the EPS estimate for next year sits at 3.70. In looking at the fundamentals, LUV has a P/E ratio of 26.72 and a price to book ratio of 4.36. The company’s Book Value is 10.028 and most recently reported EBITDA of 3.167B. The price compared to next year’s EPS estimate in the current year is 11.83.

Company Profile

Southwest Airlines Co (LUV) operates Southwest Airlines and AirTran Airways, passenger airlines that provide scheduled air transportation in the United States and near-international markets. As of December 31, 2012, the total fleet operated by Southwest and AirTran combined consisted of 694 aircraft, including 606 Boeing 737s and 88 Boeing 717s. Southwest principally provides point-to-point, rather than hub-and-spoke, service. AirTran principally provides hub-and-spoke, rather than point-to-point, service, with approximately half of AirTran’s flights originating or terminating at its base of operation in Atlanta, Georgia. AirTran also serves a number of markets with non-stop service from smaller bases of operation in Baltimore, Maryland; Milwaukee, Wisconsin; and Orlando, Florida. In December 2013, Southwest Airlines Co acquired 12 takeoff and landing slots at New York’s LaGuardia Airport being divested by American Airlines as part of its merger with US Airways.