How Will LUV Stock React To Its Upcoming Earnings?
SAN DIEGO, CALIFORNIA - APRIL 20: A Southwest Airlines Boeing 737 airplane approaches San Diego ... More International Airport for a landing from Oakland on April 20, 2025 in San Diego, California. (Photo by)
Southwest Airlines is set to publish its earnings report on Thursday, April 24, 2025. The company currently has a market capitalization of $15 billion. Over the last twelve months, Southwest recorded $27 billion in revenue, delivered $321 million in operating profit, and posted a net income of $465 million.
Looking ahead, consensus forecasts call for a loss of $0.19 per share on $6.4 billion in sales for the next report. This is compared with a loss of $0.36 per share on $6.33 billion in sales in the same period a year ago.
For event-driven traders, grasping historical post-earnings stock movements can be valuable, irrespective of how the upcoming results and outlook affect the share price. This analysis presents two potential strategies:
Over the past five years, Southwest has posted a negative one-day return after earnings in 70% of cases. The median decline in these instances was –2.7%, while the largest single-day drop reached –8.9%.
View earnings reaction history of all stocks
Key observations on one-day (1D) post-earnings returns:
Additional statistics for observed 5-day (5D) and 21-day (21D) post-earnings returns are summarized in the table below.
LUV 1D, 5D, and 21D post-earnings returns
An arguably less risky approach (though not effective if correlations are low) is to analyze the relationship between short-term and medium-term post-earnings returns, identify the pair with the strongest correlation, and apply the corresponding trade. For instance, if 1D and 5D returns exhibit the highest correlation, a trader might go 'long' for five days following a positive 1D post-earnings return. Below is some correlation data based on both five-year and three-year (more recent) histories. Note that '1D_5D' denotes the correlation between 1D post-earnings returns and the subsequent 5D returns.
LUV Correlation Between 1D, 5D and 21D Historical Returns
Peer performance can sometimes influence a stock's post-earnings reaction; pricing effects may even start before the announcement. Below is historical data comparing Southwest Airlines' post-earnings performance with peers that reported earnings immediately before Southwest Airlines. For consistency, peer returns also reflect one-day (1D) post-earnings returns.
LUV Correlation With Peer Earnings
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