LUVNEUTRAL

Return on Equity (ROE)

10.1%

Updated 200h ago

Sector Performance

37th percentile

LUV

10.1%

Sector Median

13.8%

Sector Avg

31.4%

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Deep Analysis

Return on equity (ROE) measures how effectively a company generates profit from shareholders' money; LUV's current ROE of 10.1% means it earns $10.10 for every $100 of equity.

This is below the sector median of 13.8%, placing LUV in the 37th percentile among its peers. No year-over-year or quarter-over-quarter changes are available, so the trend direction over the past eight quarters cannot be assessed. The combination of a below-median ROE with no trend data offers little clarity on near-term performance, introducing uncertainty rather than a clear risk or opportunity signal. The overall NEUTRAL verdict is directly supported because the ROE is modestly below the sector median without alarming weakness or positive momentum.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about LUV?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

Who are LUV's closest peers by Return on Equity (ROE)?

The closest peers by Return on Equity (ROE) include: MRNA (-36.6%), FICO (-37.3%), XRAY (-37.7%), VRSN (-38.3%), MSCI (-45.3%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.