Southwest Airlines Co. (LUV) Valuation
Historical valuation analysis based on 1279 data points (2021-09-14 to 2026-10-16)
Southwest Airlines is the largest domestic air carrier in the United States by passengers boarded. Southwest operates nearly 800 aircraft in an all-Boeing 737 fleet. Despite offering some longer ro...
Southwest Airlines Co. (LUV) currently trades at a P/E ratio of 23.09 (historical range: 20.16–33586.60, median: 36.62), placing it at the 3th percentile — cheap relative to its history, P/S ratio of 0.64 (range: 0.51–3.29, 16th percentile — cheap relative to its history), EV/EBITDA of 20.17 (range: 7.33–133.55, 27th percentile).
Over the historical period (2021-09-14 to 2026-10-16), Southwest Airlines Co.'s P/E ratio has contracted by 99% over the observed period (from an average of 5591.7 to 40.1).
Southwest Airlines Co. trades well below its historical valuation range across most metrics.
Historical Valuation Metrics
| Metric | Current | Median | %ile | Assessment |
|---|---|---|---|---|
| P/E Ratio | 23.09 | 36.62 | 3th | cheap relative to its history |
| P/S Ratio | 0.64 | 0.76 | 16th | cheap relative to its history |
| EV/EBITDA | 20.17 | 37.69 | 27th | below its historical average |
| FCF Yield | 3.60% | 3.56% | 52th | near its historical average |
Southwest Airlines Co. (LUV) Valuation & P/E History
Southwest Airlines Co. (LUV) is a US-listed stock operating in the Consumer Cyclical sector, specifically the Air Transportation, Scheduled industry currently trading at $39.50 with a market capitalization of $19.3 billion. This page provides historical valuation analysis for LUV based on 1279 data points covering 2021-09-14 to 2026-10-16. The P/E ratio of 23.09 is below the historical median of 36.62, placing LUV at the 3th percentile of its valuation range. The P/S ratio of 0.64 compares to a median of 0.76.
LUV Valuation Metrics & Historical Range
The valuation table above shows Southwest Airlines Co.'s current and historical valuation multiples, including P/E ratio, P/S ratio, EV/EBITDA, FCF yield, and dividend yield. Each metric is compared to its own historical range to determine whether LUV is currently trading above or below its typical valuation levels.
- P/E ratio: Price-to-earnings measures how much investors pay per dollar of earnings. A P/E above the historical median suggests LUV is expensively valued; below the median suggests it is cheap.
- P/S ratio: Price-to-sales is useful for companies with volatile or negative earnings. Lower P/S relative to history may indicate value.
- EV/EBITDA: Enterprise value to EBITDA adjusts for debt and cash, providing a capital-structure-neutral valuation measure for Southwest Airlines Co..
- FCF yield: Free cash flow yield shows the cash return relative to market price. Higher yields may indicate undervaluation.
Is LUV Overvalued or Undervalued?
Southwest Airlines Co. trades well below its historical valuation range across most metrics. The overall valuation percentile of 15 combines P/E, P/S, and EV/EBITDA percentiles into a single measure of how expensive LUV is relative to its own history. A percentile below 25 suggests the stock may be undervalued, while a percentile above 75 suggests it may be overvalued.
However, valuation is only one factor in investment decisions. A stock can remain "overvalued" for years if growth accelerates, or "undervalued" if the business deteriorates. Always combine valuation analysis with financial statement analysis and the full LUV analysis page for a complete picture.
Valuation data is computed from historical price and fundamental data via Polygon.io and Finnhub.LUV trades on NYSE/NASDAQ. This page is for informational purposes only and is not financial advice.