SKYW vs. LUV: Which Stock Is the Better Value Option?

Core Viewpoint - The article compares SkyWest (SKYW) and Southwest Airlines (LUV) to determine which stock is more attractive to value investors [1] Group 1: Zacks Rank and Earnings Outlook - SkyWest has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Southwest Airlines has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank system favors stocks with positive revisions to earnings estimates, suggesting that SKYW has an improving earnings outlook [3] Group 2: Valuation Metrics - SkyWest has a forward P/E ratio of 11.20, significantly lower than Southwest Airlines' forward P/E of 28.96 [5] - The PEG ratio for SkyWest is 1.28, while Southwest Airlines has a PEG ratio of 4.83, indicating that SKYW is expected to grow earnings at a more favorable rate [5] - SkyWest's P/B ratio is 1.7, compared to Southwest Airlines' P/B of 2.03, further supporting the valuation advantage of SKYW [6] Group 3: Value Grades - Based on the valuation metrics, SkyWest has a Value grade of A, while Southwest Airlines has a Value grade of C, indicating that SKYW is currently the superior value option [6]