Southwest cut to Hold at Argus on high costs, delayed aircraft deliveries

Argus downgraded Southwest to Hold from Buy. The analyst cites the company’s high employee costs and delayed aircraft deliveries that make the road to recovery for Southwest “longer than anticipated”. Southwest will also require time to accelerate revenue growth and improve its network, the firm adds, stating that because of the “drastic” cut in the number of planes that Boeing (BA) will deliver to the airline, Argus is cutting its FY24 EPS view to $1.20 from $2.40 and its FY25 view to $2.00 from $2.80.