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Southwest Airlines CoFRA:SWN -2.02%83 Earnings Yield (Joel Greenblatt) % is 5.40% as of Mar. 2026, which is 20% below its 10-year median of 6.71. GuruFocus rates FRA:SWN with a GF Score™ of 83/100 and a GF Value™ of €37.04 (Modestly Overvalued). The stock has 3 warning signs investors should review. Among 1,025 Transportation companies, Southwest Airlines Co ranks worse than 67.02% on this metric.
Southwest Airlines Co's Enterprise Value for the quarter that ended in Mar. 2026 was €18,511 Mil.
Southwest Airlines Co's EBIT for the trailing twelve months (TTM) ended in Mar. 2026 was €1,000 Mil. Southwest Airlines Co's Earnings Yield (Joel Greenblatt) for the quarter that ended in Mar. 2026 was 5.40%.
The historical rank and industry rank for Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % or its related term are showing as below:
FRA:SWN'
s Earnings Yield (Joel Greenblatt) % Range Over the Past 10 Years
Min: -19.41 Med: 6.71 Max: 18.27
Current: 4.35
During the past 13 years, the highest Earnings Yield (Joel Greenblatt) of Southwest Airlines Co was 18.27%. The lowest was -19.41%. And the median was 6.71%.
FRA:SWN's Earnings Yield (Joel Greenblatt) % is ranked worse than 67.02% of 1025
companies
in the Transportation industry
Industry Median: 6.87
vs FRA:SWN: 4.35
Joel Greenblatt's definition of earnings yield has the same problems the regular earnings yield does. It does not consider the growth of the company. It only looks at one-year's business operation. For cyclical companies, the earnings yield is usually highest at the peak of the business cycle. But these earnings are rarely sustainable.
A better indicator of the attractiveness of an investment which takes growth into account is the Forward Rate of Return (Yacktman) %. Southwest Airlines Co's Forward Rate of Return (Yacktman) % for the quarter that ended in Mar. 2026 was 0.00%. The Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Southwest Airlines Co (FRA:SWN) Earnings Yield (Joel Greenblatt) % Explanation
Joel Greenblatt defines the earnings yield using the above equation because it more accurately reflects the company's profitability relative to its stock price. Items like interest payment and tax etc. are not directly related to the company's operational profitability.
Enterprise Value instead of market cap (share price) is used in the calculation because it is the real price stock and bond investors together pay for the company.
Be Aware
Joel Greenblatt's definition of earnings yield has the same problems the regular earnings yield does. It does not consider the growth of the company. It only looks at one-year's business operation. For cyclical companies, the earnings yield is usually highest at the peak of the business cycle. But these earnings are rarely sustainable.
Southwest Airlines Co Earnings Yield (Joel Greenblatt) % Related Terms
Southwest Airlines Co Earnings Yield (Joel Greenblatt) % Historical Data
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The historical data trend for Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Southwest Airlines Co Earnings Yield (Joel Greenblatt) % Chart
For the Airlines subindustry, Southwest Airlines Co's Earnings Yield (Joel Greenblatt) %, along with its competitors' market caps and Earnings Yield (Joel Greenblatt) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Southwest Airlines Co Earnings Yield (Joel Greenblatt) % vs Transportation Industry
For the Transportation industry and Industrials sector, Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % distribution charts can be found below:
* The bar in red indicates where Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % falls into.
Southwest Airlines Co Earnings Yield (Joel Greenblatt) % Calculation
In his book, The Little That Beat the Market, hedge fund manager Joel Greenblatt defines Earnings Yield as operating income divided by enterprise value.
Southwest Airlines Cos Earnings Yield (Joel Greenblatt) for the fiscal year that ended in Dec. 2025 is calculated as
Southwest Airlines Co's EBIT for the trailing twelve months (TTM) ended in Mar. 2026 adds up the quarterly data reported by the company within the most recent 12 months, which was €1,000 Mil.
What does a Earnings Yield (Joel Greenblatt) % of 5.40% mean?
Southwest Airlines Co (FRA:SWN) has a Earnings Yield (Joel Greenblatt) % of 5.40% as of Mar. 2026. Joel Greenblatt's earnings yield equals the ratio of earnings before interest and taxes to enterprise value. View historical data on Southwest Airlines Co and its competitors. This is 20% below median its historical median of 6.71. According to the industry distribution chart, Southwest Airlines Co ranks #687 out of 1025 companies in the Transportation industry, placing it in the top 67%.
Is Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % too high?
Southwest Airlines Co's current Earnings Yield (Joel Greenblatt) % of 5.40% is 20% below median its 10-year median of 6.71. The Transportation industry median Earnings Yield (Joel Greenblatt) % is 6.87. Southwest Airlines Co's value of 5.40% is 21.4% below this industry median. Based on the distribution chart, Southwest Airlines Co ranks #687 out of 1025 companies in the Transportation industry, which is below the industry midpoint. Overall, Southwest Airlines Co has a GF Score™ of 83/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Southwest Airlines Co's Earnings Yield (Joel Greenblatt) % compare to AAL and UAL?
According to the Transportation industry distribution chart, Southwest Airlines Co ranks #687 out of 1025 companies for Earnings Yield (Joel Greenblatt) %. This places Southwest Airlines Co in the lower half of its industry. The industry median Earnings Yield (Joel Greenblatt) % is 6.87. Southwest Airlines Co's value of 5.40% is 21.4% below this benchmark. While the company's 10-year median is 6.71 vs. the industry median of 6.87, Southwest Airlines Co has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Earnings Yield (Joel Greenblatt) % for a Transportation company?
The median Earnings Yield (Joel Greenblatt) % among Transportation companies is 6.87, based on 1,025 companies in the industry. Companies in the top quartile (top 25%) have a Earnings Yield (Joel Greenblatt) % significantly above this median, while those in the bottom quartile fall well below. However, Earnings Yield (Joel Greenblatt) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Southwest Airlines Co's current Earnings Yield (Joel Greenblatt) % of 5.40% is 21.4% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Earnings Yield (Joel Greenblatt) % mean?
A high Earnings Yield (Joel Greenblatt) % can signal that a stock is expensive relative to its fundamentals. Joel Greenblatt's earnings yield equals the ratio of earnings before interest and taxes to enterprise value. View historical data on Southwest Airlines Co and its competitors. For the Transportation industry, the median Earnings Yield (Joel Greenblatt) % is 6.87 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Southwest Airlines Co's current Earnings Yield (Joel Greenblatt) % is 5.40%, which is 20% below median its own 10-year median of 6.71. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Southwest Airlines Co stock overvalued right now?
Based on GuruFocus' analysis, Southwest Airlines Co (FRA:SWN) is currently considered Modestly Overvalued. The stock's GF Value™ is €37.04, compared to a current price of €41.70 — trading 12.6% above its estimated fair value. The current Earnings Yield (Joel Greenblatt) % is 5.40%, which is 20% below median its 10-year median of 6.71 and 21.4% below the Transportation industry median of 6.87. Southwest Airlines Co's overall GF Score™ is 83/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Earnings Yield (Joel Greenblatt) % calculated?
Earnings Yield (Joel Greenblatt) % is calculated from a company's financial statements. For Southwest Airlines Co (FRA:SWN), the current Earnings Yield (Joel Greenblatt) % is 5.40% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Southwest Airlines Co (FRA:SWN) Overvalued in 2026?
Based on GuruFocus' analysis, Southwest Airlines Co stock appears to be overvalued.
The current stock price of €41.70 is trading 12.6% above its estimated GF Value™ of €37.04.
GuruFocus considers Southwest Airlines Co to be Modestly Overvalued.
Key valuation signals for FRA:SWN:
Earnings Yield (Joel Greenblatt) %: 5.40% (20% below median its 10-year median of 6.71)
GF Value™: €37.04 vs. price of €41.70 (12.6% above fair value)
Industry Position: 21.4% below the Transportation median (#687 of 1025)
No single metric tells the full story. See the FRA:SWN stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Southwest Airlines is the largest domestic air carrier in the United States by passengers boarded. Southwest operates nearly 800 aircraft in an all-Boeing 737 fleet. Despite offering some longer routes and a few perks for business travelers, the airline predominantly specializes in short-haul, leisure flights operated with a simple cabin configuration in a point-to-point network. In early 2026, Southwest modified its cabins to offer some rows with extra legroom, its ticketing process and merchandising to offer assigned seats, and more fare categories to include a basic economy class that appears for the first time in travel aggregators' search results and more directly competes with other airlines' offerings.
83GF Score
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Earnings Yield (Joel Greenblatt) % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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