Southwest Airlines Company (NYSE: LUV) shares rose in value on Tuesday January 17 on lighter trade volume than normal after a number of analysts weighed in on the investing value of the stock with a upgraded rating.
Meanwhile, in early trade, the Dow Jones Industrial Average was 47 points lower, or 0.24% to 19838, the S&P 500 fell 7 points, or 0.29% to 2267, while the Nasdaq was down 19 points, or 0.35% to 5554.
Analysts at Zacks Investment Research upgraded shares of Southwest Airlines Company (NYSE: LUV) from Hold to Buy today. Zacks Investment Research currently has a rating of Buy on the stock. A number of other analysts have commented on the company in recent days, and the company has secured a consensus one-year price target of $59.10, higher than the opening price of $50.88, a difference of 11.55 percent. Southwest Airlines Company stock has a 52-week high of $52.20. Share prices often trend to the upside on recommendations and new price targets of professional analysts.
Shares of Southwest Airlines Company (NYSE: LUV) opened at $50.88 yesterday trading between $50.69 and $51.21, and last traded at $51.19, an increase of $0.04 compared to the previous closing price.
Southwest Airlines Company (NYSE: LUV) now has a market cap of 31.51B.
Southwest Airlines Company (NYSE: LUV) Average Daily Trading Volume
The stock’s average daily volume is 7,009,480 shares out of a total float 614,415,000 and some 437,597 shares traded hands yesterday, 86 percent below the average. lower than normal. Look for trading volume to pick up in the coming days as momentum traders often use increases in trading volume to identify heavy volume accumulation or distribution by institutional investors.
While increased trading for short periods will not mean much will not mean much, however, a trend of heavy trading volume on the buy side over a period of days or weeks sends a positive signal to market traders that institutions may be moving in, so institutional sponsorship is very important.
Institutional sponsorship simply refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.
Professional investors such as these retain teams of analysts researching thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.
Southwest Airlines Company (NYSE: LUV) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
By identifying trends, moving averages allow traders to make those trends work in their favor and increase the number of successful trades.
With that in mind, Southwest Airlines Company (NYSE: LUV) now has a 50-day MA of $49.62 and 200-day MA of $41.94. It has traded in a 52-week range between $33.96 – 52.20 and today’s last price is 1.93%% lower than the 52 week high of $52.20.
Indeed, earnings growth is among the most critical things to look at in regards to stock investing and, accordingly, investors identify companies that have raised their earnings at least 25% or more for the past 3 years.
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