Warren Buffett may have a shrink on call to talk him down whenever he's tempted to invest in an airline, but not all investors have this luxury. Those tempted to buy into Southwest Airlines' (NYSE:LUV) decades-long growth story might want to check out tomorrow's Q2 2007 earnings news before deciding whether to place an order.

After the news comes out, we'll have time aplenty to dissect it. But in these few hours before we begin obsessing over Southwest's short-term progress, let's take a moment to review what investors think about it as a long-term investment. Our tool in this endeavor: Motley Fool CAPS, where we poll more than 60,000 investors for their views on well over 4,000 companies, Southwest among them. Here's what Fools have to say about the company.

Up or down?
More than 600 investors have submitted opinions on the company. Their verdict: Mr. Buffett has a point.

Eighty-three percent of CAPS investors think Southwest is headed for rough weather, and the very best investors -- our CAPS All-Stars -- are even more nervous, giving the stock just 78% approval. Little wonder, then, that Southwest earns just two CAPS stars out of a possible five.

Then again, among U.S. airlines, Southwest's two stars are twice as many as anyone else gets. To find an airline stock that investors actually like, you must first take a slow boat to China:

Major Airlines Group

CAPS Rating

China South (NYSE:ZNH)




Delta (NYSE:DAL)




Continental Airlines (NYSE:CAL)


US Airways (NYSE:LCC)




Wall Street vs. Main Street
Even Wall Street seems to have abandoned hope on Southwest. In contrast to what we saw last quarter (13 buy ratings against a pair of sells), analysts now vote 5-to-3 against Southwest. Quite a reversal of sentiment, considering that the stock isn't doing that much worse today than it was back then -- underperforming the S&P 500 by 29 percentage points over the last 52 weeks.

Bull pitch
The top-rated CAPS pitch for Southwest fans lauds the firm's history of never losing money in a fiscal year, and highlights its built-in cost advantages: "... they pay less for every aspect of the airline business. Less for new aircraft because [they] have bought about 1000 Boeing 737 's. less for parts as all 737's use the same parts, less for fuel because of hedging and less for the money for all of the above because fuel, equipment costs and labor are the largest cost items and have the lowest cost in all areas."

Bear pitch
Out of all the bearish pitches for Southwest, I think this one sums up the case best: "Airlines can't stay profitable. With added fuel and security measures, it cuts too much into the value. Even with some of the better financials in the regional airline business, Southwest won't outperform the market ... If you want an airline to be profitable for your portfolio, go outside of the states."

Granted, Southwest has in fact remained profitable over the years. But what really impresses me about this pitch is how well it tallies with the overall CAPS sentiment on airlines expressed in the table above. Our collective intelligence appears to be firmly convinced that airlines are bad business in the U.S. -- but there's still hope for China.

Who said that?
To learn the identities of the wise Fools who penned these words, to examine their records (and see whether they know whereof they speak), and to explore the plethora of additional financial data we've put together on the company, just click here.

Fool contributor Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 630 out of more than 60,000 raters. The Fool's disclosure policy has nothin' but love for ya, baby.