LUV PE Ratio 2026
Southwest Airlines Co Price to Earnings Analysis
Current P/E Ratio
50.08
Stock Price
$39.44
EPS (TTM)
$0.79
Valuation
Overvalued
PE Ratio Breakdown
Trailing P/E (TTM)
50.08
Based on last 12 months earnings
Industrials Industry Avg
20.00
LUV is 150% above industry
PEG Ratio
98.57
Potentially overvalued
What Does LUV P/E Ratio Mean?
Current Valuation
At a P/E ratio of 50.08, investors are paying $50.08 for every $1 of LUV's annual earnings. This high P/E suggests investors expect strong future earnings growth or that the stock is trading at a premium.
Industry Comparison
Compared to the Industrials industry average P/E of 20, LUV is trading at a premium. This could be justified by superior growth, profitability, or competitive position.
PE Ratio Calculator
How P/E ratio changes with different stock prices:
At $31.55
P/E: 39.94
20% lower
At $35.50
P/E: 44.93
10% lower
At $43.38
P/E: 54.92
10% higher
At $47.33
P/E: 59.91
20% higher
Get Complete LUV Valuation Analysis
DCF model, comparable companies, and AI-powered insights
Frequently Asked Questions
What is LUV PE ratio?
LUV (Southwest Airlines Co) has a price-to-earnings (P/E) ratio of 50.08. This means investors are paying $50.08 for every $1 of LUV's annual earnings. The P/E ratio is a key valuation metric used to assess whether a stock is overvalued or undervalued relative to its earnings.
What is a good PE ratio?
A "good" P/E ratio depends on the industry and growth prospects. Generally, a P/E ratio between 15-25 is considered reasonable for mature companies. Growth stocks often trade at higher P/E ratios (30-50+) due to expected future earnings growth. Value stocks typically have lower P/E ratios (below 15). Compare LUV's P/E of 50.08 to its industry average and historical range.
Is LUV overvalued based on PE ratio?
LUV's P/E ratio of 50.08 is above the Industrials industry average of approximately 20. This suggests the stock may be trading at a premium, though high P/E ratios can be justified by strong growth prospects.
What is the difference between forward and trailing PE ratio?
The trailing P/E ratio uses earnings from the past 12 months (historical data), while the forward P/E ratio uses projected earnings for the next 12 months (future estimates). LUV's trailing P/E is 50.08. Forward P/E is often more useful for growth companies as it reflects expected future performance.
How do you calculate PE ratio?
P/E ratio is calculated by dividing the stock price by earnings per share (EPS). Formula: P/E = Stock Price / EPS. For LUV, with a current price of $39.44 and EPS of $0.79, the P/E ratio is 49.92. A higher P/E means investors pay more per dollar of earnings.
What is PEG ratio and how does it relate to PE?
The PEG (Price/Earnings to Growth) ratio adjusts the P/E ratio for earnings growth. It's calculated as P/E / Earnings Growth Rate. LUV's PEG ratio is approximately 98.57. A PEG below 1.0 suggests the stock may be undervalued relative to its growth rate, while above 2.0 may indicate overvaluation.