Southwest Airlines Company (LUV)
Southwest Airlines Co., typically referred to as Southwest, is one of the major airlines of the United States and the world's largest low-cost carrier airline. It is headquartered in Dallas, Texas.
Stock Price Trends
Stock price trends estimated using linear regression.
Key facts
- The primary trend is increasing.
- The growth rate of the primary trend is 15.32% per annum.
- LUV price at the close of April 29, 2025 was $27.26 and was lower than the bottom border of the primary price channel by $0.16 (0.57%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 41.32% per annum.
- LUV price at the close of April 29, 2025 was inside the secondary price channel.
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of LUV price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: September 11, 2023
End date: April 2, 2025
a = 2.7624
b = 0.0004
s = 0.0820
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0004) – 1
= 15.32%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0820) – 1
= 38.84%
September 11, 2023 calculations
Top border of price channel:
Exp(Y846)
= Exp(a + b × X846 + 2 × s)
= Exp(a + b × 1,229 + 2 × s)
= Exp(2.7624 + 0.0004 × 1,229 + 2 × 0.0820)
= Exp(3.4065)
= $30.16
Bottom border of price channel:
Exp(Y846)
= Exp(a + b × X846 – 2 × s)
= Exp(a + b × 1,229 – 2 × s)
= Exp(2.7624 + 0.0004 × 1,229 – 2 × 0.0820)
= Exp(3.0784)
= $21.72
April 2, 2025 calculations
Top border of price channel:
Exp(Y1,237)
= Exp(a + b × X1,237 + 2 × s)
= Exp(a + b × 1,798 + 2 × s)
= Exp(2.7624 + 0.0004 × 1,798 + 2 × 0.0820)
= Exp(3.6288)
= $37.67
Bottom border of price channel:
Exp(Y1,237)
= Exp(a + b × X1,237 – 2 × s)
= Exp(a + b × 1,798 – 2 × s)
= Exp(2.7624 + 0.0004 × 1,798 – 2 × 0.0820)
= Exp(3.3006)
= $27.13
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 15.32% per annum.
- LUV price at the close of April 29, 2025 was $27.26 and was lower than the bottom border of the primary price channel by $0.16 (0.57%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: December 2, 2024
End date: April 29, 2025
a = 5.9843
b = -0.0015
s = 0.0691
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0015) – 1
= -41.32%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0691) – 1
= 31.84%
December 2, 2024 calculations
Top border of price channel:
Exp(Y1,155)
= Exp(a + b × X1,155 + 2 × s)
= Exp(a + b × 1,677 + 2 × s)
= Exp(5.9843 + -0.0015 × 1,677 + 2 × 0.0691)
= Exp(3.6729)
= $39.37
Bottom border of price channel:
Exp(Y1,155)
= Exp(a + b × X1,155 – 2 × s)
= Exp(a + b × 1,677 – 2 × s)
= Exp(5.9843 + -0.0015 × 1,677 – 2 × 0.0691)
= Exp(3.3965)
= $29.86
April 29, 2025 calculations
Top border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(5.9843 + -0.0015 × 1,825 + 2 × 0.0691)
= Exp(3.4567)
= $31.71
Bottom border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(5.9843 + -0.0015 × 1,825 – 2 × 0.0691)
= Exp(3.1803)
= $24.05
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 41.32% per annum.
- LUV price at the close of April 29, 2025 was inside the secondary price channel.