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Should You Buy Southwest Airlines Stock Before Its Earnings?

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Southwest Airlines is gearing up to report its third-quarter earnings results. The travel sector has been hit hard by the COVID-19 pandemic. What can investors expect from Southwest Airlines' earnings? Should you buy the stock before the earnings report?

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Southwest Airlines' earnings date and time

Southwest Airlines plans to report its third-quarter earnings on Oct. 22 at 6.30 a.m. ET, according to the earnings schedule on the company’s investor relations website. The earnings will be for the three months through September 2020. 

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Airline companies are counting their losses. Travel has decreased in 2020 amid the COVID-19 pandemic. For example, companies are choosing to host meetings virtually through Zoom Video and other apps instead of having people travel for in-person meeting. 

What is Southwest Airlines' stock price today?

Southwest Airlines stock popped up 1.63 percent to $40.50 in the pre-market session on Tuesday, Oct. 20. The stock jumped 0.43 percent on Oct. 19 and closed at $39.85 after trading in the range of $39.57–$40.75. So far, Southwest Airlines stock is down 26 percent in 2020.

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Southwest Airlines' stock forecast

Is Southwest Airlines stock right for your portfolio? A second economic stimulus package and a successful COVID-19 vaccine would bode well for epicenter stocks like Southwest Airlines. The most bullish analyst sees a 40 percent upside potential in Southwest Airlines stock from the current level to $56 in 12 months. In contrast, the most bearish analyst sees a 27 percent downside in the stock to $29. Most of the analysts recommend buying Southwest Airlines stock.

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Why has Southwest Airlines suspended its dividend?

The COVID-19 pandemic has hit the travel industry hard in 2020. The coronavirus pandemic has also impacted Southwest Airlines' dividends. Although the company has a long dividend history going back to 1976, it has suspended dividends until further notice. The company has also suspended its stock repurchase program indefinitely. 

Southwest Airlines accepted the government’s COVID-19 relief fund and received $3.3 billion. Southwest Airlines’ last dividend payout took place on March 25 when the company distributed a dividend of $0.18 per share. Investors seeking stocks with dividends will have to look beyond Southwest Airlines. The company had $899 million remaining in its stock repurchase program when it suspended the program in April. 

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