Due to the airline company’s strong franchise, management team, balance sheet, and exposure to the rising tide in both leisure and corporate travel, as well as specialized catalysts like the MAX rollout, credit card agreement, and GDS integration, Southwest Airlines Co. ( NYSE:LUV ) is positioned as Morgan Stanley’s top pick in the airline sector. LUV stock, in the firm’s opinion, will stand out as investors turn back to the aviation industry.
LUV stock outlook
Morgan Stanley gave Southwest Airlines (LUV) a strong rating after the company’s Q3 earnings report and conference call last week, both of which were good. On the call, LUV management said they were confident that their operational reliability was back on track. This gave them room to push the top line up and the CASMxF down through 2023, despite a weak 3Q print and an in-line 4Q guide.
According to LUV’s 2023 guidance, there will be better cost control and sales visibility, as well as more visibility beyond a three-month horizon. LUV stock has the ninth-highest quantitative score in the global airline industry, and its Seeking Alpha Quant Rating is flashing Buy.
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