HSBC upgraded Southwest (LUV) to Hold from Reduce with a price target of $36.10, up from $24.40. The company reported a Q1 earnings miss due to high fuel prices, but its new revenue initiatives drove significant growth in unit revenue, the analyst tells investors in a research note. HSBC believes Southwest’s “massive” increase in RASM and cost controls could partly offset fuel pressure and boost its earnings. It sees an attractive valuation at current share levels.
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