Southwest Airlines Co.

Southwest Airlines Co. (NYSE: LUV) operates Southwest Airlines, a U.S. passenger carrier offering scheduled flights across domestic and select international markets. The airline sells four main fare types—Wanna Get Away, Wanna Get Away Plus, Anytime, and Business Select—designed to give travelers flexible pricing and service options.

As per US Dailies Report published on ‘LUV’ on Nov 26, 2025, Kalkine provided a ‘Buy’ stance on the stock at USD 34.36 based on fundamental as well as technical analysis and the stock price has now moved up by 21.94%.

Noted below are the details of technical summary provided in our previous report:

Rationale for Sell Recommendation:

• Southwest Airlines continues to face several challenges despite recent progress, including lingering macro-related revenue pressure and uncertainty from factors such as the U.S. government shutdown, which has weighed on business travel and demand. The company also acknowledged near-term RASM dilution from tactical capacity decisions—such as delaying aircraft retrofits to keep more seats in service—which boosts EBIT but makes unit revenue look weaker. Further, Southwest’s “core” revenue trend is difficult to isolate given heavy reliance on new initiatives, and analysts repeatedly questioned whether underlying performance (excluding bag fees and premium-seat changes) is deteriorating. Finally, the airline remains exposed to fuel price volatility—in particular West Coast crack spreads—and must sustain aggressive cost discipline to offset rising expenses and protect earnings in a still-uneven demand environment.
• The U.S. Department of Transportation has waived an USD 11 million fine against Southwest Airlines from its earlier USD 140 million settlement related to the December 2022 holiday travel meltdown that disrupted over 2 million passengers. The waiver was granted because Southwest has committed over USD 1 billion to operational improvements since the incident.

LUV’s Daily Chart

Southwest’s earnings outlook remains vulnerable due to weak core revenue trends, RASM dilution, macro uncertainty, and fuel cost volatility. Despite investments and a waived fine, past operational failures and limited visibility support a ‘Sell’ rating is assigned to the ’LUV’ at the current market price of USD 41.90 as of Dec 15,2025 at 7:55 am PST.  

Note: This report may be updated with details around fundamental and technical analysis, price chart in due course, as appropriate.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is Dec 15, 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.