WallStSmart

Southwest Airlines Company (LUV)vsUnited Airlines Holdings Inc (UAL)

VS
⚡

Smart Verdict

WallStSmart Research — data-driven comparison

United Airlines Holdings Inc generates 109% more annual revenue ($62.90B vs $30.07B). UAL leads profitability with a 5.6% profit margin vs 2.8%. LUV appears more attractively valued with a PEG of 0.20. LUV earns a higher WallStSmart Score of 66/100 (B-).

LUV

Strong Buy

66

out of 100

Grade: B-

Growth: 7.3Profit: 4.5Value: 7.0Quality: 5.5
Piotroski: 6/9Altman Z: 1.84

UAL

Buy

57

out of 100

Grade: C

Growth: 5.3Profit: 6.0Value: 4.7Quality: 4.5
Piotroski: 6/9Altman Z: 1.16
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

Intrinsic value data unavailable for LUV.

UALSignificantly Overvalued (-41.9%)

Margin of Safety

-41.9%

Fair Value

$69.01

Current Price

$103.43

$34.42 premium

UndervaluedFair: $69.01Overvalued

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

LUV3 strengths · Avg: 8.7/10
PEG RatioValuation
0.2010/10

Growing faster than its price suggests

Revenue GrowthGrowth
16.4%8/10

16.4% revenue growth

EPS GrowthGrowth
20.5%8/10

Earnings expanding 20.5% YoY

UAL4 strengths · Avg: 8.8/10
P/E RatioValuation
10.5x10/10

Attractively priced relative to earnings

Return on EquityProfitability
20.1%9/10

Every $100 of equity generates 20 in profit

Price/BookValuation
2.0x8/10

Reasonable price relative to book value

Revenue GrowthGrowth
16.0%8/10

16.0% revenue growth

Areas to Watch

LUV4 concerns · Avg: 3.0/10
Altman Z-ScoreHealth
1.844/10

Grey zone — moderate risk

Profit MarginProfitability
2.8%3/10

2.8% margin — thin

Operating MarginProfitability
3.4%3/10

Operating margin of 3.4%

Free Cash FlowQuality
$-495.00M2/10

Negative free cash flow — burning cash

UAL4 concerns · Avg: 2.5/10
Profit MarginProfitability
5.6%3/10

5.6% margin — thin

Debt/EquityHealth
1.933/10

Elevated debt levels

PEG RatioValuation
6.502/10

Expensive relative to growth rate

EPS GrowthGrowth
-17.2%2/10

Earnings declined 17.2%

Comparative Analysis Report

WallStSmart Research

Bull Case : LUV

The strongest argument for LUV centers on PEG Ratio, Revenue Growth, EPS Growth. Revenue growth of 16.4% demonstrates continued momentum. PEG of 0.20 suggests the stock is reasonably priced for its growth.

Bull Case : UAL

The strongest argument for UAL centers on P/E Ratio, Return on Equity, Price/Book. Revenue growth of 16.0% demonstrates continued momentum.

Bear Case : LUV

The primary concerns for LUV are Altman Z-Score, Profit Margin, Operating Margin. Thin 2.8% margins leave little buffer for downturns.

Bear Case : UAL

The primary concerns for UAL are Profit Margin, Debt/Equity, PEG Ratio. Debt-to-equity of 1.93 is elevated, increasing financial risk.

Key Dynamics to Monitor

UAL carries more volatility with a beta of 1.27 — expect wider price swings.

LUV is growing revenue faster at 16.4% — sustainability is the question.

LUV generates stronger free cash flow (-495M), providing more financial flexibility.

Monitor AIRLINES industry trends, competitive dynamics, and regulatory changes.

Bottom Line

LUV scores higher overall (66/100 vs 57/100) and 16.4% revenue growth. Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

Southwest Airlines Company

INDUSTRIALS · AIRLINES · USA

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.

Visit Website →

United Airlines Holdings Inc

INDUSTRIALS · AIRLINES · USA

United Airlines Holdings, Inc. (formerly known as United Continental Holdings, Inc., UAL Corporation, Allegis Corporation and founded originally as UAL, Inc.) is a publicly traded airline holding company headquartered in the Willis Tower in Chicago. UAH owns and operates United Airlines, Inc.

Visit Website →

Want to dig deeper into these stocks?