Southwest Airlines Company (NYSE: LUV) and Controladora Vuela Compania de Aviacion, S.A.B. de C.V. (NYSE:VLRS) are both transportation companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitabiliy and dividends.

Valuation & Earnings

This table compares Southwest Airlines Company and Controladora Vuela Compania de Aviacion, S.A.B. de C.V.’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Southwest Airlines Company $20.48 billion 1.90 $5.01 billion $3.31 19.41
Controladora Vuela Compania de Aviacion, S.A.B. de C.V. $1.33 billion 1.19 $74.36 million $0.75 20.84

Southwest Airlines Company has higher revenue and earnings than Controladora Vuela Compania de Aviacion, S.A.B. de C.V.. Southwest Airlines Company is trading at a lower price-to-earnings ratio than Controladora Vuela Compania de Aviacion, S.A.B. de C.V., indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Southwest Airlines Company and Controladora Vuela Compania de Aviacion, S.A.B. de C.V., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Southwest Airlines Company 0 6 11 0 2.65
Controladora Vuela Compania de Aviacion, S.A.B. de C.V. 0 4 3 0 2.43

Southwest Airlines Company presently has a consensus target price of $63.38, suggesting a potential downside of 1.33%. Controladora Vuela Compania de Aviacion, S.A.B. de C.V. has a consensus target price of $16.10, suggesting a potential upside of 3.01%. Given Controladora Vuela Compania de Aviacion, S.A.B. de C.V.’s higher possible upside, analysts clearly believe Controladora Vuela Compania de Aviacion, S.A.B. de C.V. is more favorable than Southwest Airlines Company.

Risk & Volatility

Southwest Airlines Company has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500. Comparatively, Controladora Vuela Compania de Aviacion, S.A.B. de C.V. has a beta of 0.01, meaning that its stock price is 99% less volatile than the S&P 500.

Insider and Institutional Ownership

80.6% of Southwest Airlines Company shares are held by institutional investors. 0.2% of Southwest Airlines Company shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Southwest Airlines Company and Controladora Vuela Compania de Aviacion, S.A.B. de C.V.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Southwest Airlines Company 10.16% 26.75% 9.40%
Controladora Vuela Compania de Aviacion, S.A.B. de C.V. 6.18% 14.76% 7.06%

Dividends

Southwest Airlines Company pays an annual dividend of $0.50 per share and has a dividend yield of 0.8%. Controladora Vuela Compania de Aviacion, S.A.B. de C.V. does not pay a dividend. Southwest Airlines Company pays out 15.1% of its earnings in the form of a dividend. Controladora Vuela Compania de Aviacion, S.A.B. de C.V. has raised its dividend for 5 consecutive years.

Summary

Southwest Airlines Company beats Controladora Vuela Compania de Aviacion, S.A.B. de C.V. on 14 of the 17 factors compared between the two stocks.

Southwest Airlines Company Company Profile

Southwest Airlines Co. (Southwest) operates Southwest Airlines, a passenger airline that provides scheduled air transportation in the United States and near-international markets. The Company provides point-to-point service. The Company offers ancillary service offerings, such as Southwest’s EarlyBird Check-In and transportation of pets and unaccompanied minors, in accordance with Southwest’s respective policies. Southwest’s Rapid Rewards frequent flyer program enables program members (Members) to earn points for every dollar spent on Southwest fares. Its Internet Website, Southwest.com, is an avenue for Southwest customers to purchase and manage travel online. As of December 31, 2016, Southwest operated a total of 723 Boeing 737 aircraft and served 101 destinations in 40 states, the District of Columbia, the Commonwealth of Puerto Rico, and eight near-international countries: Mexico, Jamaica, The Bahamas, Aruba, Dominican Republic, Costa Rica, Belize, and Cuba.

Controladora Vuela Compania de Aviacion, S.A.B. de C.V. Company Profile

Controladora Vuela Compania de Aviacion SAB de CV (Volaris Aviation Holding Company) is a Mexico-based company principally engaged in the airline passenger transportation industry. The Company is a law-cost carrier airline. Controladora Vuela Compania de Aviacion SAB de CV offers direct, point-to-point flights. The Company serves through secondary, lower cost airports and provides a single class of service. The Company utilizes such aircraft as the Airbus A319 and A320 families, among others. The Company has such subsidiaries as Comercializadora Volaris SA de CV, Servicios Corporativos Volaris SA de CV, Concesionaria Vuela Compania de Aviacion SAPI de CV, Deutsche Bank Mexico SA Trust 1484, among others.

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