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Southwest Airlines (LUV – 30.15) was on the earnings front line this morning, announcing fourth-quarter results of 29 cents per share. These numbers topped analysts' expectations by a penny and represented a 61-percent increase over last year's figures for the same time period. LUV officials backed this news up with reports that the firm will likely face slower growth in the first quarter than it enjoyed in the fourth quarter. The Street seems to be focussing on this portion of the announcement, sending the stock into negative territory on average volume.
Last week, LUV closed beneath its 10-week moving average for the first time since September 15. The shares remain about five percent above potential support at their 20-week trendline.
On the options front, total call open interest in the front three-month series currently dwarfs total put open interest by nearly four times. However, over 60 percent of LUV's current call open interest will expire this Friday. Looking ahead, there are over 16,000 open contracts in residence at the January 2002 25 LEAPS call. By contrast, the site of heaviest open interest among 2002 put LEAPS is the January 17.50 put, the site of only 134 contracts.