Takeaways from Management Meetings

Research evidence excerpt

Takeaways from Management Meetings

Update

June 30, 2026 01:03 PM GMT

Morgan Stanley & Co. LLCMSouthwest Airlines Co. | North America Ravi Shanker

Equity Analyst

Takeaways from Management Ravi.Shanker@morganstanley.comMadison J Pasterchick +1 212 761-6350

Research Associate

Madison.Pasterchick@morganstanley.com +1 212 761-3787

Meetings Nancy Hipp

Nancy.Hipp@morganstanley.com +1 212 761-1311

LUV management believes that they "have their mojo back" on margin momentum

driven by internal RASM initiatives (with more to come) amid the backdrop of rapidly Southwest Airlines Co. (LUV.N, LUV UN)

improving industry conditions. Airlines | United States of America

Stock Rating Overweight

We visited LUV management including CFO Tom Doxey and MD of IR Danielle Industry View Attractive

Price target $60.00

Collins at their HQ in Dallas. Mgmt. remains very enthusiastic on continued

Shr price, close (Jun 29, 2026) $51.60

momentum from idio revenue initiatives, while talking up industry discipline on Mkt cap, curr (mm) $28,672

52-Week Range $55.10-28.98

capacity growth and RASM trends. The stock has been on a rollercoaster since

October and we were surprised to see a disproportionate negative reaction in March

with the Middle East conflict, but the stock has now decently recovered together

with peers. We continue to see LUV as a beneficiary of continued idiosyncratic

traction (with more runway to go there than they get credit for, in our view) as well

as normalization of macro conditions. Ultimately, we believe LUV can join DAL and

UAL as the “Quality 3” in the Airline space and make the case for multiple

rerating to 15x on normalized EPS, implying a $75+ stock price.

Our key takeaways from the meeting:

1. On RASM. Mgmt. confirmed that they have been able to successfully