Compare Stocks › LUV vs MS
Southwest Airlines Co. (LUV) vs Morgan Stanley (MS)
LUV
Southwest Airlines Co.
$40.87
VS
MS
Morgan Stanley
$158.55
Rewards
LUV
- ★Share count has been reduced by 13% over the past 4 years through buybacks, increasing each share's claim on earnings.
- ★Each dollar of retained earnings has created $11.48 of market value — management is an exceptional capital allocator.
- ★5 insider purchases over the past 12 months with a buy/sell ratio above 3:1 — a sustained pattern of insider confidence.
MS
- ★Gross margin of 87.1% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Each dollar of retained earnings has created $6.65 of market value — management is an exceptional capital allocator.
- ★PEG ratio of 0.75 suggests the stock is undervalued relative to its growth rate — paying less than 1x for each unit of earnings growth.
Risks
LUV
- ⚠Gross margin of 22.0% is low, suggesting a competitive or commodity-like market with limited pricing power.
- ⚠Trailing P/E of 51.7x is 26% above the historical average of 41.2x — the stock trades at a premium to its own history.
- ⚠Beneish M-Score of -1.64 flags financial patterns consistent with potential earnings manipulation — warrants further investigation.
MS
- ⚠High leverage (4.56x debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
- ⚠Altman Z-Score of 0.29 places the company in the distress zone — financial patterns resemble those of companies that experienced bankruptcy.
- ⚠7 insider sales totaling $25.2M with no purchases in the past 3 months — insiders are reducing their exposure.
Key Valuation Metrics
Learn more →LUV
MS
Valuation
$-683.88M
Free Cash Flow
N/A
-3.24%
FCF Yield
N/A
51.73
Trailing P/E
15.53
8.42
Forward P/E
12.89
Quality & Moat
8.09%
ROIC
3.43%
5.53%
ROE
14.42%
22.04%
Gross Margin
87.06%
1.02
PEG Ratio
0.75
Balance Sheet Safety
0.75
Debt / Equity
4.56
N/A
Interest Coverage
N/A
1.60
Net Debt / EBITDA
N/A
1.76%
Dividend Yield
2.52%
LUV: 3Ties: 1MS: 5
LUVMS
Historical Fundamentals
Learn more →LUV
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation.
MS
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation.
$1 Retained Earnings Test
Learn more →LUV
$11.48
created per $1 retained over 3 years
Exceptional Value Creator
Σ Retained
$114.0M
Δ Market Cap
+$1.31B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
MS
$6.65
created per $1 retained over 3 years
Exceptional Value Creator
Σ Retained
$20.84B
Δ Market Cap
+$138.59B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →LUV
32.3% Overvalued
Price is 32.3% above estimated fair value
Current Price: $40.87
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
Fair Value: $30.89
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
MS
45.5% Margin of Safety
Price is 45.5% below estimated fair value
Current Price: $158.55
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
Fair Value: $290.92
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
Reverse DCF — Market-Implied Growth
Learn more →LUV
Requires positive FCF to compute implied growth rate.
MS
Requires positive FCF to compute implied growth rate.
Economic Moat Score
Learn more →LUV
37/100
No Moat
70+ Wide · 40-69 Narrow · <40 None
No durable moat detected, though revenue predictability shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.
Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.
MS
32/100
No Moat
70+ Wide · 40-69 Narrow · <40 None
No durable moat detected, though revenue predictability shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.
Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.
Forensic Accounting
Learn more →LUV
-1.64
Likely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
MS
-2.09
Possible Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →LUV
Insiders 1.3%Institutions 97.7%Retail & Other 1.0%
No. of Institutional Holders1,089
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.
MS
Insiders 24.0%Institutions 62.7%Retail & Other 13.3%
No. of Institutional Holders3,181
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.
High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →LUV
0
Buys (3M)
5
Buys (12M)
Total value (12M): $713,401
SARETSKY GREGG A
Director
$100,447
@ $30.03 · 2025-08-06
FEINBERG SARAH
Director
$45,008
@ $30.01 · 2025-08-05
SARETSKY GREGG A
Director
$100,169
@ $27.29 · 2025-04-30
BREBER PIERRE R.
Director
$268,877
@ $26.89 · 2025-04-29
HESS DAVID P
Director
$198,900
@ $26.52 · 2025-04-28
FEINBERG SARAH
Director
$15,740
@ $31.48 · 2025-03-14
WATSON PATRICIA A
Director
$99,935
@ $30.58 · 2025-03-13
REYNOLDS CHRISTOPHER P.
Director
$99,955
@ $30.68 · 2025-03-13
CUSH C DAVID
Director
$150,150
@ $30.03 · 2025-03-12
ATHERTON LISA M
Director
$3,691
@ $31.28 · 2025-01-30
GANGWAL RAKESH
Director
$7.11M
@ $29.39 · 2024-10-01
GANGWAL RAKESH
Director
$4.83M
@ $29.15 · 2024-10-01
GANGWAL RAKESH
Director
$3.75M
@ $29.49 · 2024-10-01
GANGWAL RAKESH
Director
$15.87M
@ $29.89 · 2024-10-01
GANGWAL RAKESH
Director
$19.30M
@ $29.98 · 2024-10-01
KELLY GARY C
Officer and Director
$1.00M
@ $29.52 · 2024-09-30
GANGWAL RAKESH
Director
$34.92M
@ $29.47 · 2024-09-30
GANGWAL RAKESH
Director
$20.93M
@ $29.65 · 2024-09-30
Open market purchases · includes direct & indirect ownership · excludes option exercises
MS
0
Buys (3M)
1
Buys (12M)
Total value (12M): $5,630
PETERSON DOUGLAS L
Director
$5,630
@ $156.39 · 2025-10-17
Open market purchases · includes direct & indirect ownership · excludes option exercises
Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →LUV
0
Sells (3M)
1
Sells (12M)
Total value (12M): $302,056
JONES JUSTIN
Officer
$302,056
@ $37.36 · 2025-12-05
RUTHERFORD LINDA B
Officer
$132,386
@ $34.39 · 2024-12-06
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives
MS
7
Sells (3M)
16
Sells (12M)
Total value (12M): $62.45M
SIMKOWITZ DANIEL A
President
$6.02M
@ $182.61 · 2026-01-30
GROSSMAN ERIC F
Officer
$3.97M
@ $184.00 · 2026-01-20
CRAWLEY MANDELL L.
Officer
$1.44M
@ $183.45 · 2026-01-20
YESHAYA SHARON
Chief Financial Officer
$2.94M
@ $185.77 · 2026-01-20
SMITH CHARLES AUBREY III
Officer
$1.55M
@ $182.08 · 2026-01-20
PIZZI MICHAEL A
Officer
$3.69M
@ $184.55 · 2026-01-20
SAPERSTEIN ANDREW MICHAEL
President
$5.57M
@ $183.62 · 2026-01-20
PICK EDWARD N.
Chief Executive Officer
$16.43M
@ $164.34 · 2025-10-31
GROSSMAN ERIC F
Officer
$1.69M
@ $141.12 · 2025-07-17
SIMKOWITZ DANIEL A
President
$4.09M
@ $141.13 · 2025-07-17
SMITH CHARLES AUBREY III
Officer
$2.81M
@ $140.30 · 2025-07-17
PIZZI MICHAEL A
Officer
$2.53M
@ $140.62 · 2025-07-17
SIMKOWITZ DANIEL A
President
$3.70M
@ $127.37 · 2025-05-12
HERZ ROBERT H
Director
$95,459
@ $119.32 · 2025-05-02
SAPERSTEIN ANDREW MICHAEL
President
$4.80M
@ $120.00 · 2025-05-02
GROSSMAN ERIC F
Officer
$1.12M
@ $111.65 · 2025-04-15
CRAWLEY MANDELL L.
Officer
$1.15M
@ $138.06 · 2025-01-22
GROSSMAN ERIC F
Officer
$1.78M
@ $136.20 · 2025-01-21
SIMKOWITZ DANIEL A
President
$5.00M
@ $136.61 · 2025-01-21
AKRAM RAJA
Chief Financial Officer
$2.38M
@ $136.01 · 2025-01-21
PIZZI MICHAEL A
Officer
$2.52M
@ $136.92 · 2025-01-21
SAPERSTEIN ANDREW MICHAEL
President
$4.20M
@ $136.43 · 2025-01-21
CRAWLEY MANDELL L.
Officer
$368,375
@ $105.25 · 2024-07-26
AKRAM RAJA
Officer
$797,764
@ $106.37 · 2024-07-18
SIMKOWITZ DANIEL A
President
$4.26M
@ $106.54 · 2024-07-17
HERZ ROBERT H
Director
$106,621
@ $106.62 · 2024-07-17
CRAWLEY MANDELL L.
Officer
$692,663
@ $99.61 · 2024-05-14
GORMAN JAMES P
Officer and Director
$9.02M
@ $90.21 · 2024-04-18
SMITH CHARLES AUBREY III
Officer
$1.01M
@ $90.09 · 2024-04-17
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →LUV
😨Fear(36/100)
"Market is pessimistic — investigate whether fears are temporary or structural"
Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
MS
😐Neutral(48/100)
"Market is pricing this stock without strong emotion in either direction"
Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →LUV
⚪Awaiting DCF Data
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
DCF Margin of Safety: N/AMr. Market's Mood: Fear (36)
MS
⚪Awaiting DCF Data
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
DCF Margin of Safety: N/AMr. Market's Mood: Neutral (48)