The Lundberg Survey of gasoline prices has some good news for consumers. Over the last couple of weeks, the price of petro has dropped about $0.06 per gallon.

The average cost for a gallon of regular unleaded now stands at about $1.61, down from a high of $1.73. Prices range from $1.34 in Atlanta to $2.07 in San Francisco (which seems to lead the nation in the price of everything).

Lundberg says there will probably be downward pressure on gas prices in the near future, unless Thursday's meeting of OPEC nations throws a monkey wrench in things.

In today's Motley Fool Take:

Southwest Flies Upward

The contrast couldn't be starker. As a slew of big American carriers, including US Airways, United Airlines, American(NYSE: AMR) (whose situation Robert Brokamp tackles today), and others are either flirting with bankruptcy, in it, or coming out of it, Southwest Airlines(NYSE: LUV) reported both an operating profit and positive operating and free cash flow.

Southwest should consider a new name: The Airline. Because, at this rate, it's going to be the only one left. How would the FTC react if a company became a monopoly because all the others failed? Fortunately, that's not going to happen, particularly with more nimble competitors like JetBlue(Nasdaq: JBLU) and Alaska Air(NYSE: ALK) out there.

For the quarter, Southwest managed earnings of $24 million. Kudos to these folks, though, because they provide cash flow statements with their earnings announcements. There, we can see the true power of the company's results: operating cash flow of $267 million and free cash flow of $74 million.

Looking at Southwest's cash flow statement, it's staggering that airlines are actually such a bad business. One of the big accounts affecting cash flow is the "air traffic liability" -- the amount of money paid to the company for service yet to be rendered. This represents an interest-free $123 million in Southwest's coffers, from customers who have yet to use their tickets. In the insurance business, that's known as "float," and it's a great moneymaker, even if the company's just generating simple interest off of the funds.

Results would've been higher were it not for an increase in fuel costs -- more than 20% gross, more than 18% per gallon used. As oil prices have already declined, this could be a substantial kicker for earnings in upcoming quarters. The biggest risks for this company seem to be from an investing standpoint, rather than an operational one. At $11 billion market cap, the company trades at a free cash flow ratio of more than 37, and an enterprise value to free cash flow ratio of 43. That's rich. Even with a reduction of fuel costs, these ratios don't decline that much.

In other words, Southwest is priced for perfection. Fortunately, to date, it's nearly been just that.

Quote of Note

"The path to success is paved with good intentions that were carried out." -- Robert C. Edwards, former president of Clemson University

Telecoms Ring With Debt

Independent research and analysis firm Standard & Poor's pointed out today that nearly $20 billion in debt issued by telecom and cable companies will come due through 2005.

That shouldn't come as a surprise to investors in these companies, but it highlights why one must tread lightly in this suffering sector.

According to the report, telecom and cable firms have amassed about $206 billion in debt, with more than 20% coming due by the end of 2005. However, the strongest players in the business -- most notably the regional bells -- issued much of the debt, and these companies will likely have no problem refinancing their obligations.

But that still leaves about $19 billion in debt that can be credited to the weakest players in the business. S&P describes the likelihood of payment from firms like Qwest Communications(NYSE: Q), which carries over $6 billion in debt coming due through 2005, and Charter Communications(Nasdaq: CHTR), which carries $1.5 billion maturing in the same time period, as "worrisome to highly doubtful."

It's no secret that the overall telecommunications sector has suffered greatly these past several years. Basically, demand for products and services vanished just as these companies completed extensive network upgrades, which they incurred massive debts to accomplish.

But the saddest part of this saga is the fact that fraud seems to have taken a heavier toll on the firms that played fairly, as they struggled to keep up with the phantom growth of their unscrupulous competitors. Those same competitors are now emerging from bankruptcy debt free (for more on this, see Bill Mann's recent article).

In effect, cheats such as WorldCom are now in a better position to compete than before. Worse, their defaults and bankruptcies have curbed the appetite of the credit markets for anything telecom, making it much more difficult for the honest firms to get funding. Getting burned once is bad enough, but twice?

With few options, the weakest players will be left scurrying to renegotiate debt maturities or to sell assets. In the end, more defaults and bankruptcies are likely. Stay away.

Give Yourself Some Credit

Credit can be your best friend or your worst enemy. And you know what they say... don't turn your back on your enemies. Friends may come and go, but enemies accumulate. So it's time to address that big elephant in the closet -- your credit. We've got your back! Visit our Motley Fool Credit Center and learn how to make credit work for you.

Jeeves Spiffs Up

Ask Jeeves (Nasdaq: ASKJ) is the latest search company to upgrade its technology and capabilities in an attempt to increase market share in the face of Google's domination.

Yahoo! (Nasdaq: YHOO) , for example, unveiled its latest search engine a few weeks ago, and search advertising firm Overture(Nasdaq: OVER) recently announced it will buy Alta Vista. The hunt for search supremacy is on.

Ask Jeeves' new Smart Search streamlines the searching process and its results. The technology will immediately provide images and news for search terms that it determines warrant such results, instead of users having to click another tab to see pictures or news. The site is also cleaner and, according to the company, loads 50% faster than it did previously.

Additionally, searchers will be able to more easily find out local information, such as movie show times and directions, with the new Ask Jeeves. A search for movie times, for example, will first return a zip code request, and then the desired information. Related search topics and clarification for searches have also been improved and expanded.

Ask Jeeves is the fifth-most popular search destination according to a February 2003 Neilsen/Net Ratings survey. The site had 13 million visitors and the average time spent there was 11 minutes per person. Google, on the other hand, enjoyed 40.3 million visitors and 25 minutes per person.

Ask Jeeves says it's not trying to replicate Google, but provide an alternative to the popular search engine instead. It believes there's room for several players in the market. When speaking with Reuters, President Steve Berkowitz said, "We've always taken the approach of not trying to out-Google Google."

That's a smart tactic, and if Ask Jeeves can effectively market itself, it just might work. The company, which has been around for six years, is profitable and provides search services for businesses in addition to its butler-branded site. It announces first-quarter results tomorrow afternoon, and is expected to earn $0.04 a share on sales of $23.25 million.

Discussion Board of the Day: Consumer Credit/Credit Cards

Paper or plastic? Have reward cards sold you on the convenience of charging purchases, or do you feel that credit cards provide an incentive to overspend? What's the best deal out there for you? All this and more -- in the Consumer Credit/Credit Cards discussion board. Only on

Quick Takes

Office equipment maker Xerox(NYSE: XRX) says it will have to take a first-quarter charge of $183 million to cover the costs of litigation involving its retirement plan. That will have a negative impact on earnings to the tune of $0.25 per share. The stock was up today, however, on news the company may see stronger growth this year, and that first-quarter operational earnings will exceed expectations.

Drugmaker Merck(NYSE: MRK) saw its profit rise 7% over last year's first quarter, thanks to strong performances from its core drugs. The company's five largest products grew sales at a 19% rate. Management also reaffirmed full-year earnings guidance of $3.40 to $3.47 per share.

3M's (NYSE: MMM) first-quarter profit popped up 15% from a year ago, excluding charges associated with a lawsuit. Performance drivers include cost controls and strong results from the new graphics division. The industrial giant said it still expects to earn $5.65 to $5.85 per share for the full year.

Whirlpool (NYSE: WHR) is scaling back its 2003 forecast because of lower demand for home appliances. The company reported a first-quarter of profit of $1.32 per share, thanks to "improved productivity and lowered costs," as well as benefits from restructuring.

In local news, chicken farmer Lester Simmons issued an apology for yesterday's Easter Sunday debacle. Simmons promised to implement new quality controls to make sure eggs meant for the hatchery are never again mixed with those donated to the annual Calvary Church Easter egg hunt.

And Finally...

Today on

Bob Bobala, Robert Brokamp, Mathew Emmert, Jeff Fischer, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Jackie Ross, Reggie Santiago, Dayana Yochim