Morgan Stanley Survey: Southwest Airlines No Longer A Growth Investment

In Morgan Stanley's latest Airline Question of the Week, the survey asked, "in your view, is Southwest Airlines a legacy carrier or a growth airline?"

According to respondents to Morgan Stanley's survey, 25 percent believe Southwest Airlines (NYSE: LUV) is a growth airline, and 75 percent believe Southwest Airlines is a legacy airline.

Morgan Stanley's methodology:

“The Airline Question of the Week (QoW) is an informal poll of our readership. The poll is entirely voluntary and we intend to display the aggregated results (individual results are entirely confidential) in the following week's report.”

Over the historical five-year period, Southwest Airlines year over year growth has decelerated quite significantly. The declining annualized growth rates may be the reason respondents stated Southwest Airlines is no longer a growth airline.

Other highlights from Morgan Stanley Airlines Question the Week:

“The combination of ancillary revenue growth, cooperative fuel prices and favorable CASM (cost per available seat mile) ex-fuel growth trends go a long way toward mitigating the risks from decelerating PRASM (passenger revenue per available seat mile). In fact, we continue to see upside to cons.”

Southwest Airlines has declined by 1.2 percent Tuesday.