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Southwest Airlines Co. (LUV) vs SkyWest, Inc. (SKYW)

Southwest Airlines Co. and SkyWest, Inc. are both Airlines companies. Southwest Airlines Co. is the larger, with a market value of $21.8B against $3.0B — 7.2× the size. SkyWest, Inc. trades at the lower P/E: 7.6× against 21.1×. Southwest Airlines Co. grew revenue faster over the last twelve months: 14.5% against 7.03%. SkyWest, Inc. has the higher net margin (9.70% vs 3.34%) and the lower return on invested capital (8.00% vs 9.02%). Across the 21 metrics below, SkyWest, Inc. leads on 13 and Southwest Airlines Co. on 8.

Valuation

Metric LUV SKYW Airlines median
P/E 21.05 7.61 9.74
P/S 0.69 0.72 0.62
P/B 2.96 1.09 2.03
Price to free cash flow 122.72 22.67 18.01
EV/EBITDA 8.12 8.26 8.55
EV/Sales 0.76 1.14 0.92
Earnings yield 4.75% 13.14% 3.19%
Free cash flow yield 0.81% 4.41% 3.20%

Profitability

Metric LUV SKYW Airlines median
Gross margin 22.94% 69.82% 51.70%
Operating margin 4.39% 13.85% 6.13%
Net margin 3.34% 9.70% 1.73%
Free cash flow margin 0.56% 3.19% 3.29%
Return on equity 13.96% 15.05% 14.11%
Return on assets 3.58% 5.61% 1.28%
Return on invested capital 9.02% 8.00% 4.91%

Growth

Metric LUV SKYW Airlines median
Revenue growth (TTM) 14.50% 7.03% 12.32%
EPS growth (last fiscal year) 3.95% 33.20% 9.88%
Revenue growth, 5-year CAGR 25.41% 13.79% 25.83%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric LUV SKYW Airlines median
Debt to equity 0.80 0.84 0.76
Current ratio 0.47 0.58 0.62
Net debt to EBITDA 0.84 1.72 1.42

Dividend

Metric LUV SKYW Airlines median
Dividend yield 1.62% — 1.28%
Payout ratio 0.35 — 0.20

Size

Metric LUV SKYW Airlines median
Market cap 21.76b 3.04b 2.23b

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