How Has Southwest Utilized Its Cash Flows?
Southwest Airline’s (NYSE:LUV) cash flows from operations have increased significantly over the last few years due to the effect of plummeting crude oil prices on the company’s expenses. Consequently, the airline increased its capital spending to revamp its existing fleet and add more fuel-efficient planes, although by a far lower percentage than the other players in the market. In contrast, after repaying some debt in 2013, the company has been somewhat increasing its long-term obligations, likely to fund the aircraft it has rented. Further, the carrier returned over $3 billion to its shareholders over the last three years in the form of share repurchases, one of the highest in the industry. Going forward, the company expects the growth in cash flow from operations to slow down due to the rising oil prices, while its capital expenditure remains stable due to the restructured delivery schedule for aircraft. Further, the carrier has authorized a $2 billion share repurchase program to compensate its shareholders with the benefits from cost-savings.
Have more questions about Southwest Airlines (NYSE:LUV)? See the links below:
- Why Trefis Revised Southwest’s Price Estimate From $46 To $38 Per Share
- Southwest Drops Post 2Q’16 Results As The Airline Restricts Its Capacity Growth For 2017-2018
- Southwest Q2’16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM
- How Will Different Capacity And Fuel Cost Forecasts Impact Southwest’s 2016 EBITDA?
- Rapid Capacity Additions And Lower Fuel Expense Drive Southwest’s 1Q’16 Earnings
- What Will Be The Impact On Southwest’s EBITDA, If Crude Oil Prices Rebound To $100 Per Barrel by 2018?
- Will Southwest’s International Operations Contribute A Significant Portion Of Its Revenue By 2020?
- What Will Be Southwest’s Value In 2020?
- What Factors Caused A Sharp Jump In Southwest’s 2015 Operating Margin?
- How Has Southwest’s Revenue And EBITDA Composition Changed Over The Last Five Years?
- Southwest Airlines: The Year 2015 In Review
- What Is Southwest’s Outlook For 2016?
- What Is Southwest’s Fundamental Value Based On 2016 Estimated Numbers?
- What Is Southwest’s Revenue And EBITDA Composition?
- How Has Southwest’s Revenue And EBITDA Grown Over The Last Five Years?
- What’s Behind The 15% Fall In Southwest Airlines Stock Earlier This Week?
- What’s Next For Southwest Stock After A 20% Rise This Year?
- Gaining 20% In 2023 Will Delta Continue To Outperform Southwest Stock?
- Will Southwest Airlines Stock Recover To Its Pre-Inflation-Shock Level?
- Here’s A Better Pick Over Southwest Airlines Stock
- Southwest Airlines Stock Has Shed 30% Since Late 2019: Here’s Why
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Southwest Airlines
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