Southwest Airlines (LUV) stock is experiencing a downturn on Tuesday following the announcement of a significant shakeup within the company’s board of directors. Executive Chairman Gary Kelly, along with six other board members, will be stepping down.
Kelly’s resignation will take effect after the 2025 Annual Meeting, while the remaining six directors, including David Biegler, Veronica Biggins, Roy Blunt, William Cunningham, Thomas Gilligan, and Jill Soltau, will leave following the November board meeting. This decision comes in response to feedback from shareholders, who have voiced their concerns about the airline’s performance.
The board is also implementing a structural change by eliminating the Executive Committee and establishing a new Finance Committee to oversee financial and operational plans. This committee will be filled with new and existing directors in November. The board will also appoint a new Lead Director and Committee Chairs for the Audit, Compensation, and Nominating and Corporate Governance Committees.
Elliott Investment Management, a significant stakeholder in Southwest, issued a press release on Tuesday expressing its satisfaction with the board’s initial steps towards change. They stated their intention to collaborate with the remaining directors to ensure further necessary changes are implemented.
Investing in Southwest Stock
Interested in investing in Southwest Airlines? Besides purchasing shares through a brokerage platform, you can access Southwest stock indirectly through exchange-traded funds (ETFs) that hold the stock within their portfolios. ETFs often include shares in various large, liquid companies within a specific sector, allowing investors to gain exposure to the broader trends within that sector.
In Southwest Airlines’ case, it falls under the Industrials sector. Therefore, an ETF focusing on this sector would likely hold shares in Southwest, offering investors a convenient way to invest in the airline. Alternatively, you can consider allocating a portion of your 401(k) to strategies that aim to acquire shares in mutual funds or other instruments within the Industrials sector.
As of this writing, Southwest stock is down 2.89% at $28.87 per share. The recent board changes and shareholder pressure are likely to continue influencing the airline’s future trajectory and stock performance.
