Who luvs Southwest?
Posted
Nov 02 2007, 05:11 PM
by
Matt Koppenheffer
It's been a challenging decade for the airlines. The 2001 terrorist attacks body slammed the industry, employee relations have been less than stellar as they try to cut costs, and the seemingly unstoppable price of oil continues to crimp business. American Airlines and Delta just pushed through some price hikes aimed at offsetting the rocketing price of jet fuel, and United and Southwest did some of the same last month.
For investors, the question is whether there is opportunity to be found in the face of these headwinds. On The Motley Fool's CAPS service, players are split on the prospects for Southwest, a long-time favorite among investors. Though there are fair number of Southwest bulls, the stock has just a two star rating -- suggesting that it's not among the best investment opportunities in the 5,000-stock CAPS universe.
One player bullish on the stock, KenN513, noted that "[Southwest] is the most solid of the large airlines. It has great financials and superb management." Others also noted how much the stock's price has fallen over the past few months. On the flip side, Southwest bear crepps sums it up very simply:
"Q: What do you have when you have an elite company within a lousy industry?
A: A lousy company."
He notes that competition is strong in the industry and that Southwest will be "paddling upstream."
So who's right? Head over to CAPS to see what others have said and chime in with your own thoughts.
(Full disclosure: I do not have a financial position in any of the companies mentioned.)