Question 1

What is Southwest Airlines's P/FCF ratio?

Accepted Answer

Southwest Airlines (LUV) P/FCF ratio is 33.3× as of February 6, 2023. The ratio is calculated by dividing market capitalisation by trailing twelve-month free cash flow, using USD-normalised financials (IAS 21 exchange-rate translation for non-USD reporters).

Question 2

How is the P/FCF ratio calculated?

Accepted Answer

P/FCF = Market Capitalisation ÷ Trailing Twelve-Month (TTM) Free Cash Flow, where Free Cash Flow = Operating Cash Flow − Capital Expenditures. All inputs are sourced from audited GAAP/IFRS filings and translated to USD using period-end exchange rates so the multiple is comparable across companies and currencies.

Question 3

What is the P/FCF ratio?

Accepted Answer

The price-to-free-cash-flow (P/FCF) ratio compares a company's market capitalisation to its trailing twelve-month (TTM) free cash flow. It is calculated as market cap ÷ TTM free cash flow, where free cash flow = operating cash flow − capital expenditures. Because FCF cannot be inflated by non-cash accounting items, P/FCF is often considered a cleaner measure of "earnings-power valuation" than P/E — especially for capital-intensive businesses where depreciation diverges from real cash outflows.

Question 4

What is a good P/FCF ratio for Southwest Airlines?

Accepted Answer

Mature companies that consistently convert profit into cash often trade at 15–25× P/FCF; capital-intensive businesses with lumpy capex typically trade lower. Compare against sector peers and against the company's own multi-year average — single-year P/FCF can be distorted by working-capital swings. For Southwest Airlines specifically, the relevant sector benchmark is the current sector median of 24.3×.

Question 5

Is Southwest Airlines's P/FCF ratio high or low?

Accepted Answer

Southwest Airlines's P/FCF ratio of 33.3× is above its own 5-year average of 22.7× and above the sector median of 24.3×. That places the current reading at the 70th percentile of its 10-year history. A higher multiple usually reflects stronger expected growth, lower perceived risk, or higher returns on capital; a lower multiple reflects the opposite.

Question 6

What is Southwest Airlines's historical P/FCF ratio range?

Accepted Answer

In the available daily series, Southwest Airlines (LUV) P/FCF ratio has ranged from a low of 2.9× in 2008 to a high of 1707.6× in 2006. The 5-year average is 22.7× and the 5-year median is 27.7×.

Question 7

What was Southwest Airlines's P/FCF ratio in 2021?

Accepted Answer

Southwest Airlines (LUV) P/FCF ratio at the end of 2021 was 14.0×. Annual values reflect the multiple on the last trading day of each calendar year, using the trailing twelve-month free cash flow figure available at that date.

Question 8

Why does Southwest Airlines's P/FCF ratio change over time?

Accepted Answer

Valuation multiples move with two inputs: the numerator (market capitalisation, which tracks the share price) and the denominator (free cash flow). Share-price changes — driven by interest rates, earnings expectations, risk appetite, and broader market sentiment — typically dominate short-term moves, while changes in the underlying fundamental drive the longer-term trend. As a result, the ratio can rise during stock-price rallies even if the business itself has not become more valuable, and fall during sell-offs even when fundamentals are improving.


2025	$21.3B	-$830M	—	—	Dec 31, 2025
2024	$20B	-$1.62B	—	—	Dec 31, 2024
2023	$17.2B	-$390M	—	—	Dec 31, 2023
2022	$20B	-$157M	—	—	Dec 31, 2022
2021	$25.4B	$1.81B	14.0×	—	Dec 31, 2021
2020	$27.4B	-$1.64B	—	—	Dec 31, 2020
2019	$28.3B	$2.96B	9.6×	+0.7×	Dec 31, 2019
2018	$26B	$2.92B	8.9×	-14.1×	Dec 31, 2018
2017	$38.7B	$1.68B	23.1×	+8.7×	Dec 31, 2017
2016	$30.8B	$2.15B	14.3×	-11.1×	Dec 31, 2016
2015	$27.9B	$1.1B	25.5×	-1.3×	Dec 31, 2015
2014	$28.7B	$1.07B	26.8×	+14.1×	Dec 31, 2014
2013	$13.2B	$1.05B	12.6×	+2.1×	Dec 31, 2013
2012	$7.53B	$717M	10.5×	-6.8×	Dec 31, 2012
2011	$6.6B	$382M	17.3×	+8.2×	Dec 31, 2011
2010	$9.71B	$1.07B	9.0×	-12.1×	Dec 31, 2010
2009	$8.47B	$401M	21.1×	—	Dec 31, 2009
2008	$6.36B	-$2.44B	—	—	Dec 31, 2008
2007	$8.94B	$1.51B	5.9×	-1701.7×	Dec 31, 2007
2006	$12B	$7M	1707.6×	+1694.7×	Dec 31, 2006
2005	$13.2B	$1.02B	12.9×	—	Dec 31, 2005
2004	$12.7B	-$618M	—	—	Dec 31, 2004
2003	$12.2B	$98M	124.7×	—	Dec 31, 2003
2002	$10.8B	-$82.9M	—	—	Dec 31, 2002


Thomson Reuters (TRI)	18.8×
PACCAR (PCAR)	18.6×
United Parcel Service (UPS)	18.5×
Gorman-Rupp (GRC)	18.5×
Alamo Group (ALG)	18.0×
Allegion (ALLE)	17.8×
Snap-on (SNA)	17.6×
United Airlines Holdings (UAL)	17.5×
Honeywell International (HON)	17.4×
Equifax (EFX)	17.0×
Norfolk Southern (NSC)	16.9×
FedEx (FDX)	15.9×
AGCO (AGCO)	15.4×
General Dynamics (GD)	15.3×
Carlisle Companies (CSL)	14.7×
Amentum Holdings (AMTM)	14.7×
Stanley Black & Decker (SWK)	14.4×
A. O. Smith (AOS)	14.2×
Huntington Ingalls Industries (HII)	14.1×
McGrath RentCorp (MGRC)	13.9×
Masco (MAS)	13.0×
Pool (POOL)	12.2×
Delta Air Lines (DAL)	10.1×
ABM Industries (ABM)	7.2×
Upwork (UPWK)	6.3×

P/FCF Ratio for Southwest Airlines (LUV) 2003-2026

P/FCF Ratio daily chart for Southwest Airlines (LUV)

Historical P/FCF Ratio for Southwest Airlines (LUV) from 2002 to 2025

About P/FCF Ratio at Southwest Airlines (LUV)

Southwest Airlines P/FCF Ratio by Year

Southwest Airlines P/FCF Ratio 2021: 14.0×

Southwest Airlines P/FCF Ratio 2019: 9.6×

Southwest Airlines P/FCF Ratio 2018: 8.9×

Southwest Airlines P/FCF Ratio 2017: 23.1×

Southwest Airlines P/FCF Ratio 2016: 14.3×

Sector peers by P/FCF Ratio — chart

Sector peers by P/FCF Ratio — table

Frequently asked questions

Southwest Airlines (LUV) Key Financials