Southwest Airlines: A Great Company in a Crummy Industry

Chad Brand submits: Most people know that over the long term the airline sector has been an absolutely horrible place to invest. In fact, the current value of the publicly traded airlines is far below the amount of capital that has been invested into them, so returns in the industry have been negative for decades.

Zacks.com submits: Southwest Airlines (LUV), the largest U.S. low-cost airline, has agreed to buy AirTran Holdings Inc. (AAI) for a combination of cash and Southwest shares. The agreement conforms with the consolidation trend in the airline industry.

Stone Fox Capital submits:Typically buyout news can be very bullish for the industry and competitors of the firm bought. Potentially less focused competition or even a higher premium for stand alone operators can be very positive. In the case of the airlines, that usually isn't the case. As soon as one airline leaves, another usually is born to take their place. Despite being a long term losing industry, airlines seem to never lack for new entrants.

Jeffrey Breen submits:Southwest's (LUV) acquisition of AirTran (AAI) sets the carrier's course for the next decade. With a stroke of the pen, Southwest has simultaneously undertaken three new challenges:

Southwest Airlines (LUV), the largest U.S. low-cost airline, has agreed to buy AirTran Holdings Inc. (AAI) for a combination of cash and Southwest shares.

ETF Database submits: As the third quarter draws to a close, 2010 hasn’t exactly been the year full of M&A activity some analysts thought it would be, but a number of high profile marriages have helped to give the still fragile economy a boost. Already this year has witnessed successful bids for data storage firm 3Par (PAR) and McAfee (MFE) with ongoing wars for Potash Corp.

eChristian Investing submits:The thought of considering an airline stock as a dividend play is probably foreign to most investors. The airline industry has never been able to consistently produce profits and has spent most of the last decade bleeding red ink.

ByAjith Babu: Most of us who have invested in airline stocks would view the headline with skepticism or outright contempt. Historically airline stocks have experienced large volatility due to an array of factors like constantly fluctuating fuel prices, frequent labor disputes, enormous debt levels, and high capital costs. From time to time we have bled money fist over hands on these stocks. Now it is payback time.