Bernstein lowered the firm’s price target on Southwest to $24 from $26 and keeps a Market Perform rating on the shares. The firm notes Southwest Airlines reported a modest Q2 EPS beat of 58c and is guiding to a loss for Q3 due to pressure on main cabin revenue. The company further announced changes to the cabin, the introduction of seat assignments, and plans for premium revenue which are going to be further detailed in the fall. From where the firm sits, the company’s plans to add pitch to the front without taking anything away in the back looks difficult to contemplate, which could complicate the company’s commercial transformation.
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