Why Southwest can succeed in the airline industry.

SOUTHWEST AIRLINES CASE STUDY May, 2002 (note we want to consider whats going on now, Feb 2003) Wow! An excited Colleen Barrett, new president of Southwest shouted in the meeting with her management team. We have bucked the money-losing trend that other U.S carriers are in and have reported a profit of $21.4 million in the first quarter of 2002. Now the management team is reflecting on second quarter 2002 results. At the same time that Southwest Airlines reported …

…percentile, 99=best, 1=worst MRQ = Most Recent Quarter TTM = Trailing 12 Months Source: 10K, 10Q Data generated on 04/30/2001 Our ResultsIndustry Results for AirlineS&P 500 Results AvgMaxMinCo Rank P/E Ratio22.4012.8224.054.688128.50 5 Year P/E High31.5337.2266.6712.273050.25 5 Year P/E Low14.918.3114.911.469217.04 Beta0.781.141.76-1.70541.00 Price/Sales (TTM)2.501.423.150.00974.07 Price/Book (MRQ)3.802.144.090.52826.15 Price/Tang. Book (MRQ)3.802.414.160.52818.83 Price/Cash Flow (TTM)15.4711.7032.201.549027.42 Price/Free Cash (TTM)0.0032.5762.145.038748.80 % Owned Institutions77.93%63.59%95.00%0.00%8457.38% Ranking based on percentile, 99=best, 1=worst MRQ = Most Recent Quarter TTM = Trailing 12 Months Source: 10K, 10Q