LUV vs. TDG: A Head-to-Head Stock Comparison

Updated on August 25, 2025

Here’s a clear look at LUV and TDG, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.

Company Profile

Symbol	LUV	TDG
Company Name	Southwest Airlines Co.	TransDigm Group Incorporated
Country	United States	United States
GICS Sector	Industrials	Industrials
GICS Industry	Passenger Airlines	Aerospace & Defense
Market Capitalization	16.38 billion USD	79.01 billion USD
Exchange	NYSE	NYSE
Listing Date	January 2, 1980	March 15, 2006
Security Type	Common Stock	Common Stock

Historical Performance

This chart compares the performance of LUV and TDG by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.

LUV vs. TDG: Growth of a $10,000 investment over the past one year.

Historical Performance at a Glance

Symbol	LUV	TDG
5-Day Price Return	1.56%	-0.75%
13-Week Price Return	-4.33%	-2.63%
26-Week Price Return	4.18%	4.96%
52-Week Price Return	16.65%	7.18%
Month-to-Date Return	0.81%	-12.83%
Year-to-Date Return	-7.26%	10.64%
10-Day Avg. Volume	7.38M	0.40M
3-Month Avg. Volume	11.72M	0.31M
3-Month Volatility	40.41%	29.15%
Beta	1.23	1.04

Profitability

Return on Equity (TTM)

LUV

4.11%

Passenger Airlines Industry

Max: 49.96%
Q3: 28.15%
Median: 15.41%
Q1: 8.29%
Min: -11.01%

LUV’s Return on Equity of 4.11% is in the lower quartile for the Passenger Airlines industry. This indicates a less efficient generation of profit from its equity base when compared to its competitors.

TDG

37.11%

Aerospace & Defense Industry

Max: 43.89%
Q3: 22.42%
Median: 12.50%
Q1: 5.21%
Min: -6.24%

In the upper quartile for the Aerospace & Defense industry, TDG’s Return on Equity of 37.11% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.

LUV vs. TDG: A comparison of their Return on Equity (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Net Profit Margin (TTM)

LUV

1.43%

Passenger Airlines Industry

Max: 17.65%
Q3: 8.90%
Median: 5.80%
Q1: 2.02%
Min: -3.12%

Falling into the lower quartile for the Passenger Airlines industry, LUV’s Net Profit Margin of 1.43% indicates weaker profitability. This means the company retains a smaller portion of each dollar in sales as profit compared to its competitors.

TDG

22.52%

Aerospace & Defense Industry

Max: 14.54%
Q3: 8.08%
Median: 6.17%
Q1: 2.49%
Min: -1.63%

TDG’s Net Profit Margin of 22.52% is exceptionally high, placing it well beyond the typical range for the Aerospace & Defense industry. This demonstrates outstanding operational efficiency and a strong competitive advantage in converting revenue into profit.

LUV vs. TDG: A comparison of their Net Profit Margin (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Operating Profit Margin (TTM)

LUV

1.15%

Passenger Airlines Industry

Max: 22.47%
Q3: 12.33%
Median: 8.62%
Q1: 4.43%
Min: -2.88%

LUV’s Operating Profit Margin of 1.15% is in the lower quartile for the Passenger Airlines industry. This indicates weaker profitability from core operations, which may stem from inefficiencies or competitive pressures on pricing.

TDG

45.94%

Aerospace & Defense Industry

Max: 16.63%
Q3: 10.38%
Median: 8.29%
Q1: 6.21%
Min: 0.95%

TDG’s Operating Profit Margin of 45.94% is exceptionally high, placing it well above the typical range for the Aerospace & Defense industry. This demonstrates outstanding efficiency in managing its core operations, which can be a result of strong pricing power or superior cost control.

LUV vs. TDG: A comparison of their Operating Profit Margin (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Profitability at a Glance

Symbol	LUV	TDG
Return on Equity (TTM)	4.11%	37.11%
Return on Assets (TTM)	1.20%	8.43%
Net Profit Margin (TTM)	1.43%	22.52%
Operating Profit Margin (TTM)	1.15%	45.94%
Gross Profit Margin (TTM)	73.31%	60.12%

Financial Strength

Current Ratio (MRQ)

LUV

0.56

Passenger Airlines Industry

Max: 1.46
Q3: 0.94
Median: 0.76
Q1: 0.54
Min: 0.17

LUV’s Current Ratio of 0.56 aligns with the median group of the Passenger Airlines industry, indicating that its short-term liquidity is in line with its sector peers.

TDG

3.13

Aerospace & Defense Industry

Max: 3.09
Q3: 1.98
Median: 1.23
Q1: 1.03
Min: 0.02

TDG’s Current Ratio of 3.13 is exceptionally high, placing it well outside the typical range for the Aerospace & Defense industry. This indicates a very strong liquidity position, though such a high ratio may also suggest that the company is not using its assets efficiently to generate profits.

LUV vs. TDG: A comparison of their Current Ratio (MRQ) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Debt-to-Equity Ratio (MRQ)

LUV

0.51

Passenger Airlines Industry

Max: 9.80
Q3: 4.82
Median: 1.30
Q1: 0.89
Min: 0.00

Falling into the lower quartile for the Passenger Airlines industry, LUV’s Debt-to-Equity Ratio of 0.51 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.

TDG

5.41

Aerospace & Defense Industry

Max: 1.70
Q3: 1.04
Median: 0.68
Q1: 0.41
Min: 0.00

With a Debt-to-Equity Ratio of 5.41, TDG operates with exceptionally high leverage compared to the Aerospace & Defense industry norm. This suggests an aggressive reliance on debt financing, which can magnify returns but also significantly elevates financial risk.

LUV vs. TDG: A comparison of their Debt-to-Equity Ratio (MRQ) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Interest Coverage Ratio (TTM)

LUV

9.27

Passenger Airlines Industry

Max: 22.60
Q3: 16.29
Median: 6.75
Q1: 1.94
Min: -8.55

LUV’s Interest Coverage Ratio of 9.27 is positioned comfortably within the norm for the Passenger Airlines industry, indicating a standard and healthy capacity to cover its interest payments.

TDG

2.72

Aerospace & Defense Industry

Max: 36.57
Q3: 19.90
Median: 7.04
Q1: 2.40
Min: -7.63

TDG’s Interest Coverage Ratio of 2.72 is positioned comfortably within the norm for the Aerospace & Defense industry, indicating a standard and healthy capacity to cover its interest payments.

LUV vs. TDG: A comparison of their Interest Coverage Ratio (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Financial Strength at a Glance

Symbol	LUV	TDG
Current Ratio (MRQ)	0.56	3.13
Quick Ratio (MRQ)	0.45	2.07
Debt-to-Equity Ratio (MRQ)	0.51	5.41
Interest Coverage Ratio (TTM)	9.27	2.72

Growth

Revenue Growth

LUV vs. TDG: A side-by-side comparison of their Revenue Growth for the MRQ (YoY), TTM (YoY), 3-Year CAGR, and 5-Year CAGR periods.

EPS Growth

LUV vs. TDG: A side-by-side comparison of their EPS Growth for the MRQ (YoY), TTM (YoY), 3-Year CAGR, and 5-Year CAGR periods.

Dividend

Dividend Yield (TTM)

LUV

2.58%

Passenger Airlines Industry

Max: 6.71%
Q3: 3.95%
Median: 1.10%
Q1: 0.00%
Min: 0.00%

LUV’s Dividend Yield of 2.58% is consistent with its peers in the Passenger Airlines industry, providing a dividend return that is standard for its sector.

TDG

5.58%

Aerospace & Defense Industry

Max: 2.03%
Q3: 1.22%
Median: 0.43%
Q1: 0.00%
Min: 0.00%

TDG’s Dividend Yield of 5.58% is exceptionally high, placing it well above the typical range for the Aerospace & Defense industry. While this may seem attractive, an unusually high yield can sometimes be a warning sign, reflecting a falling stock price or market concerns about the dividend’s sustainability.

LUV vs. TDG: A comparison of their Dividend Yield (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Dividend Payout Ratio (TTM)

LUV

59.15%

Passenger Airlines Industry

Max: 71.59%
Q3: 38.54%
Median: 8.16%
Q1: 0.00%
Min: 0.00%

LUV’s Dividend Payout Ratio of 59.15% is in the upper quartile for the Passenger Airlines industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.

TDG

891.68%

Aerospace & Defense Industry

Max: 83.87%
Q3: 49.90%
Median: 16.48%
Q1: 0.00%
Min: 0.00%

At 891.68%, TDG’s Dividend Payout Ratio is exceptionally high, exceeding the typical range for the Aerospace & Defense industry. While this provides a significant return to shareholders, it may limit funds for reinvestment and could be difficult to sustain.

LUV vs. TDG: A comparison of their Dividend Payout Ratio (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Dividend at a Glance

Symbol	LUV	TDG
Dividend Yield (TTM)	2.58%	5.58%
Dividend Payout Ratio (TTM)	59.15%	891.68%

Valuation

Price-to-Earnings Ratio (TTM)

LUV

42.24

Passenger Airlines Industry

Max: 13.29
Q3: 11.94
Median: 8.78
Q1: 7.42
Min: 3.07

At 42.24, LUV’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Passenger Airlines industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.

TDG

40.76

Aerospace & Defense Industry

Max: 65.97
Q3: 54.11
Median: 34.53
Q1: 23.66
Min: 0.00

TDG’s P/E Ratio of 40.76 is within the middle range for the Aerospace & Defense industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.

LUV vs. TDG: A comparison of their Price-to-Earnings Ratio (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Price-to-Sales Ratio (TTM)

LUV

0.60

Passenger Airlines Industry

Max: 1.09
Q3: 0.74
Median: 0.61
Q1: 0.44
Min: 0.09

LUV’s P/S Ratio of 0.60 aligns with the market consensus for the Passenger Airlines industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.

TDG

9.18

Aerospace & Defense Industry

Max: 8.07
Q3: 4.49
Median: 2.42
Q1: 1.39
Min: 0.00

With a P/S Ratio of 9.18, TDG trades at a valuation that eclipses even the highest in the Aerospace & Defense industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.

LUV vs. TDG: A comparison of their Price-to-Sales Ratio (TTM) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Price-to-Book Ratio (MRQ)

LUV

2.31

Passenger Airlines Industry

Max: 3.44
Q3: 2.89
Median: 1.84
Q1: 1.22
Min: 0.56

LUV’s P/B Ratio of 2.31 is within the conventional range for the Passenger Airlines industry. This shows a balanced market view, where the stock’s price is neither at a significant premium nor a discount to the book value of its peers.

TDG

10.13

Aerospace & Defense Industry

Max: 13.67
Q3: 7.92
Median: 4.65
Q1: 2.68
Min: 0.82

TDG’s P/B Ratio of 10.13 is in the upper tier for the Aerospace & Defense industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.

LUV vs. TDG: A comparison of their Price-to-Book Ratio (MRQ) against their respective Passenger Airlines and Aerospace & Defense industry benchmarks.

Valuation at a Glance

Symbol	LUV	TDG
Price-to-Earnings Ratio (TTM)	42.24	40.76
Price-to-Sales Ratio (TTM)	0.60	9.18
Price-to-Book Ratio (MRQ)	2.31	10.13
Price-to-Free Cash Flow Ratio (TTM)	44.16	41.32