Use this calculator to estimate the number of years it would take the cumulative earnings to equal the current stock price. You can enter a different estimated EPS and estimated annual growth rate to see how the payback period changes.
Starting EPS (default): LUV EPS (earnings per share) is low relative to its revenue. Also, the company's revenue has been growing over the last 5 years. We consider these 2 financial metrics to be an indication that the company is in a growth phase. Therefore, the actual earnings are probably low relative to LUV's revenue growth. So we estimated the company has potential to convert 3% of revenue to net earnings.
Growth Rate (default): Since LUV did not have historical earnings growth, we used the 3 yr average revenue growth rate of 6.8% as the default growth rate.
