Southwest Airlines Shares Owned By Institutions vs. Return On Asset
| LUV Stock | USD 27.98 0.62 2.27% |
For Southwest Airlines profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Southwest Airlines to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Southwest Airlines utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Southwest Airlines's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Southwest Airlines over time as well as its relative position and ranking within its peers.
Southwest |
Is Southwest Airlines' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Southwest Airlines. If investors know Southwest will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Southwest Airlines listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Southwest Airlines is measured differently than its book value, which is the value of Southwest that is recorded on the company's balance sheet. Investors also form their own opinion of Southwest Airlines' value that differs from its market value or its book value, called intrinsic value, which is Southwest Airlines' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Southwest Airlines' market value can be influenced by many factors that don't directly affect Southwest Airlines' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Southwest Airlines' value and its price as these two are different measures arrived at by different means. Investors typically determine if Southwest Airlines is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Southwest Airlines' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Southwest Airlines Return On Asset vs. Shares Owned By Institutions Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Southwest Airlines's current stock value. Our valuation model uses many indicators to compare Southwest Airlines value to that of its competitors to determine the firm's financial worth. Southwest Airlines is currently regarded as number one stock in shares owned by institutions category among related companies. It is rated fourth overall in return on asset category among related companies . The ratio of Shares Owned By Institutions to Return On Asset for Southwest Airlines is about 5,987 . Comparative valuation analysis is a catch-all model that can be used if you cannot value Southwest Airlines by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Southwest Airlines' Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Southwest Airlines' earnings, one of the primary drivers of an investment's value.Southwest Return On Asset vs. Shares Owned By Institutions
Shares Owned by Institutions show the percentage of the outstanding shares of stock issued by a company that is currently owned by other institutions such as asset management firms, hedge funds, or investment banks. Many investors like investing in companies with a large percentage of the firm owned by institutions because they believe that larger firms such as banks, pension funds, and mutual funds, will invest when they think that good things are going to happen.
Southwest Airlines |
| = | 80.82 % |
Since Institution investors conduct a lot of independent research they tend to be more involved and usually more knowledgeable about entities they invest as compared to amateur investors.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Southwest Airlines |
| = | 0.0135 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
Southwest Return On Asset Comparison
Southwest Airlines is currently under evaluation in return on asset category among related companies.
Southwest Airlines Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Southwest Airlines, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Southwest Airlines will eventually generate negative long term returns. The profitability progress is the general direction of Southwest Airlines' change in net profit over the period of time. It can combine multiple indicators of Southwest Airlines, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Southwest Airlines Co. operates as a passenger airline company that provide scheduled air transportation services in the United States and near-international markets. The company was incorporated in 1967 and is headquartered in Dallas, Texas. Southwest Airlines operates under Airlines classification in the United States and is traded on New York Stock Exchange. It employs 64123 people.
Southwest Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Southwest Airlines. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Southwest Airlines position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Southwest Airlines' important profitability drivers and their relationship over time.
Use Southwest Airlines in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Southwest Airlines position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Southwest Airlines will appreciate offsetting losses from the drop in the long position's value.Southwest Airlines Pair Trading
Southwest Airlines Pair Trading Analysis
The ability to find closely correlated positions to Southwest Airlines could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Southwest Airlines when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Southwest Airlines - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Southwest Airlines to buy it.
The correlation of Southwest Airlines is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Southwest Airlines moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Southwest Airlines moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Southwest Airlines can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Southwest Airlines position
In addition to having Southwest Airlines in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Shipping Containers
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Shipping Containers theme has 15 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Shipping Containers Theme or any other thematic opportunities.
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Check out Correlation Analysis. For more information on how to buy Southwest Stock please use our How to Invest in Southwest Airlines guide.You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Complementary Tools for Southwest Stock analysis
When running Southwest Airlines' price analysis, check to measure Southwest Airlines' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Southwest Airlines is operating at the current time. Most of Southwest Airlines' value examination focuses on studying past and present price action to predict the probability of Southwest Airlines' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Southwest Airlines' price. Additionally, you may evaluate how the addition of Southwest Airlines to your portfolios can decrease your overall portfolio volatility.
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To fully project Southwest Airlines' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Southwest Airlines at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Southwest Airlines' income statement, its balance sheet, and the statement of cash flows.