Operating Margin

Watchlist Manager

Watchlist

Price: 37.075 EUR 1.76% Market Closed

Market Cap: 22.2B EUR

1.1%

Declining

by 0.2%

Operating Margin shows how much profit a company makes from its regular business activities after covering operating costs. It helps measure how efficiently the company turns sales into profit.

Operating Margin

1.1%

Operating Income

$313m

Revenue

$27.6B

Operating Margin shows how much profit a company makes from its regular business activities after covering operating costs. It helps measure how efficiently the company turns sales into profit.

Operating Margin

1.1%

Operating Income

€313m

Revenue

$27.6B

Peer Comparison

Country		Company	Market Cap	Operating Margin
US		Southwest Airlines Co NYSE:LUV	22.6B USD	Loading...
US		Delta Air Lines Inc NYSE:DAL	46B USD	Loading...
US		United Airlines Holdings Inc NASDAQ:UAL	36.7B USD	Loading...
UK		International Consolidated Airlines Group SA LSE:IAG	19.2B GBP	Loading...
CH		Kinarus Therapeutics Holding AG SIX:KNRS	19.5B CHF	Loading...
CN		Air China Ltd SSE:601111	153.7B CNY	Loading...
IE	R	Ryanair Holdings PLC LSE:RYA	15.4B EUR	Loading...
IN		Interglobe Aviation Ltd NSE:INDIGO	1.9T INR	Loading...
CN		China Southern Airlines Co Ltd SSE:600029	140.4B CNY	Loading...
CN		China Eastern Airlines Corp Ltd SSE:600115	135.4B CNY	Loading...
CL		LATAM Airlines Group SA SGO:LTM	15.7T CLP	Loading...

Market Distribution

Min	-4 087 900%
30th Percentile	-5.1%
Median	6%
70th Percentile	14.8%
Max	1 032 600%

Other Profitability Ratios

Southwest Airlines Co
Glance View

Economic Moat

None

Market Cap

22.2B EUR

Industry

Airlines

Southwest Airlines Co., an emblematic name in the aviation industry, stands out not just for its vibrant aircraft liveries but for pioneering a unique business model that has steered its success over decades. Born from the imagination of Rollin King and Herb Kelleher in 1967, Southwest set out to disrupt traditional air travel norms by embracing a point-to-point route system rather than the conventional hub-and-spoke model. This approach, combined with a focus on short-haul flights, has allowed the airline to streamline operations, reducing turnaround time and boosting aircraft utilization. Unlike many of its competitors, Southwest's operating philosophy is anchored in a no-frills service model, which has enabled it to offer competitive fares without compromising on reliability and customer satisfaction. Financially, Southwest thrives on its low-cost carrier structure, prioritizing operational efficiency and cost control as pillars of profitability. The airline's decision to exclusively operate a fleet of Boeing 737s simplifies maintenance and training, further driving down costs. Revenue streams flow predominantly from passenger fares, bolstered by ancillary revenue channels such as priority boarding and extra-legroom seating. Southwest's savvy financial management — along with a culture of friendliness and customer engagement — has cultivated a loyal customer base that values the balance of affordability and service quality. Such strategic choices not only secure Southwest's place as a favored domestic carrier but also position it resiliently amidst industry fluctuations and economic adversities, buoyed by a business model that deftly marries cost efficiency with customer satisfaction.

View SWN Analysis

SWN Intrinsic Value

Show

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

Southwest Airlines Co
F:SWN

Peer Comparison

Market Distribution

Other Profitability Ratios

Southwest Airlines Co
Glance View

See Also

Company

Help

Tools

Stocks

52 Week Range	20.835 37.615
Price Target

Southwest Airlines Co F:SWN