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Category: Southwest Airlines (LUV) and Delta Airlines (DAL)
Date: 1 September 2020 Stock price of Southwest Airlines (LUV): $37.80 Stock price of Delta Airlines (DAL): $30.61 In this article we take a look at the recent stock price history of two of the best known airline stocks, Southwest Airlines (LUV) and Delta Airlines (DAL). Airline stocks have been hit very hard by the Covid-19 pandemic and so has their stock prices. We take a look at the recent stock price history of these two firms.
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While the stock prices of Delta and Southwest has suffered significant declines, and buyers might be tempted to jump in to take advantage of the depressed prices, one has to caution potential investors against piling into airline stocks at this point in time, as the business environment for airlines is extremely tough and it will take a very long time for airlines to be operating at pre covid-19 levels "
More About Southwest Airlines (LUV)
In its 49th year of service, Dallas-based Southwest Airlines Co. (NYSE: LUV) continues to differentiate itself from other air carriers with exemplary Customer Service delivered by more than 60,000 Employees to a Customer base topping 130 million passengers annually. Southwest became the nation’s largest domestic air carrier in 2003 and maintains that ranking based on the U.S. Department of Transportation’s most recent reporting of domestic originating passengers boarded. In peak travel seasons, Southwest operates more than 4,000 weekday departures among a network of 101 destinations in the United States and 10 additional countries.
Southwest coined Transfarency® to describe its purposed philosophy of treating Customers honestly and fairly, and low fares actually staying low. Southwest is the only major U.S. airline to offer bags fly free® to everyone (first and second checked pieces of luggage, size and weight limits apply, some carriers offer free checked bags on select routes or in qualified circumstances), and there are no change fees, though fare differences might apply.
Southwest is committed to returning value to its Shareholders. Since 2010, Southwest has returned more than $11.7 billion to Shareholders through share repurchases and dividends, through September 30, 2019. In the first nine months of 2019, Southwest returned $1.8 billion to Shareholders through the repurchase of $1.45 billion in common stock and the payment of $372 million in dividends.
Southwest coined Transfarency® to describe its purposed philosophy of treating Customers honestly and fairly, and low fares actually staying low. Southwest is the only major U.S. airline to offer bags fly free® to everyone (first and second checked pieces of luggage, size and weight limits apply, some carriers offer free checked bags on select routes or in qualified circumstances), and there are no change fees, though fare differences might apply.
Southwest is committed to returning value to its Shareholders. Since 2010, Southwest has returned more than $11.7 billion to Shareholders through share repurchases and dividends, through September 30, 2019. In the first nine months of 2019, Southwest returned $1.8 billion to Shareholders through the repurchase of $1.45 billion in common stock and the payment of $372 million in dividends.
More About Delta Airlines
Delta Air Lines (NYSE: DAL) is the U.S. global airline leader in products, services, innovation, reliability and customer experience. Powered by its 80,000 people around the world, Delta continues to invest in its people, improving the air travel experience and generating industry-leading shareholder returns.
Headquartered in Atlanta, Delta offers more than 5,000 daily departures and as many as 15,000 affiliated departures including the premier SkyTeam alliance, of which Delta is a founding member. Delta serves nearly 200 million people every year, taking customers across its industry-leading global network to more than 300 destinations in over 50 countries.
Headquartered in Atlanta, Delta offers more than 5,000 daily departures and as many as 15,000 affiliated departures including the premier SkyTeam alliance, of which Delta is a founding member. Delta serves nearly 200 million people every year, taking customers across its industry-leading global network to more than 300 destinations in over 50 countries.
Southwest Airlines (LUV) stock vs Delta Airlines (DAL) stock over the last 5 years
The image below shows the stock price history of Southwest Airlines (LUV) and Delta Airlines (DAL) over the last 5 years. As the image shows both airlines stock price suffered significant declines since the start of 2020. And its been a topsy turvy attempted recovery by the airline stocks since. While the price trends look very similar over the 5 year period the returns provide by the two airline stocks over the last 5 years are a little different. The summary below shows the stock price returns of both over the last 5 years:
- Southwest Airlines: 1.01%
- Delta Airlines: -31.7%
While the stock prices of Delta and Southwest has suffered significant declines, and buyers might be tempted to jump in to take advantage of the depressed prices, one has to caution potential investors against piling into airline stocks at this point in time, as the business environment for airlines is extremely tough and it will take a very long time for airlines to be operating at pre Covid-19 levels. And currently their biggest concern has to be their cash burn rates which is running into the millions each month. So investors should rather ask whether the various airlines have enough cash to ride out the tough times. And if not, how will they be raising capital? By issuing stock or taking on more debt? Both of these options are bad for investors, since the one has a dilutionary effect on stockholders and the other means more interest payments which means less cash for dividends and expansions.
For now we recommend staying away from airline stocks.
For now we recommend staying away from airline stocks.
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