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Here's How Much Investing $1,000 In The 2011 Spirit Airlines IPO Would Be Worth Today

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Here's How Much Investing $1,000 In The 2011 Spirit Airlines IPO Would Be Worth Today

Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.

Spirit’s Difficult Decade

One underperformer of the last decade was U.S. airline Spirit Airlines Incorporated (NYSE: SAVE).

Back in 2010, Spirit Airlines was still transitioning its business model to become an ultra-low-cost airline. Spirit offered lower ticket prices and instead began charging for amenities such as seat selection and travel insurance. In April 2010, Spirit became the first major airline to begin charging passengers for carry-on bags.

In May 2011, Spirit decided to go public, selling 15.6 million shares at a price of $12 each, below its target range of between $14 and $16. After an initial pullback to as low as $10.18 in the stock’s first few weeks of trading, Spirit really started to gain altitude throughout 2012, 2013 and 2014. By late 2014, Spirit shares had reached their all-time high of $85.35.

Unfortunately, investors didn’t realize they had a round-trip ticket.

2020 And Beyond

From early 2016 to early 2020, Spirit shares traded mostly sideways in a range around $35 and $65 before the bottom fell out during the COVID-19 outbreak. In March, Spirit traded down to a new all-time low of $7.01 before bouncing back to around $14 today.

Despite the big 2020 hit, Spirit IPO investors have still managed to squeak out a small profit over the past nine years. In fact, $1,000 worth of Spirit IPO stock in 2011 would be worth about $1,172 today.

Looking ahead, analysts aren’t expecting much more from Spirit in 2020. The average price target among the 13 analysts covering the stock is $12, suggesting 14.8% downside from current levels.

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Photo by Adam Moreira/Wikimedia.

 

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