PHOTO: Frontier Airlines has filed for an initial public offering (IPO) with the SEC (Photo via Flickr/Alec Wilson)
After months of rumors and conjecture, Frontier Group Holdings, Inc. has filed paperwork with the SEC to order to publicly trade shares for Frontier Airlines. The Denver-based airline, which filed its paperwork on Friday, will trade under the symbol FRNT, according to The Denver Business Journal.
Rumors about the public offering have been flying for months, including in an article from TravelPulse’s Rich Thomaselli back in January. Earlier this week, Bloomberg reported that an IPO could be coming as early as June.
In its filing, the airline is reporting a profit of $200 million in 2016, up from $146 million the year prior and $140 million in 2014. Also, said the airline, it carried a total of 14.9 million passengers last year netting a total revenue of $1.714 billion for the year.
Despite Frontier's somewhat rosy financial snapshot, airline stocks are not a sure bet on Wall Street.
It has been more than three years since an airline made a public offering. The last public offering for an airline was made in 2014 by Virgin America, which has since been acquired by Alaska Airlines.
But a turnabout in by billionaire investor Warren Buffet, who once called airline stocks a “death trap” for investors, could be fueling increased Wall Street confidence in airline stock. In the past year, Buffet’s company, Berkshire Hathaway has purchased more than $9 billion in airline shares, even prompting rumors that Buffet was planning on buying an airline outright.
READ MORE: Buffett rebuffs talk of airline buy
The Frontier filing is actually the second airline IPO this year. In February, Azul SA, a Brazilian airline operated by David Neeleman who founded JetBlue Airways Corp., also filed papers with the SEC.
This is the second time Frontier Airlines will be traded as a public company. The last time was in the early 2000s, but circumstances changed in 2009 after the airline filed for bankruptcy and was then acquired by Republic Airways Holdings. Frontier has since been sold to private equity firm Indigo Partners, which has been focused on converting the airline into an Ultra Low Cost Carrier (ULCC) offering low fares and charging fees for almost everything else on board. Indigo Partners has significant airline experience and once owned Spirit Air, which went public in 2011.
While Frontier plans to continue to compete in the ULCC arena, it plans to do it better than its competitors. In the filing, the airline said it would focus on "attracting customers with low fares and garnering repeat business by delivering a high-quality, family-friendly customer experience with a more upscale look and feel than historically experienced on ULCCs globally.”
The airline is also planning to grow its presence in several mid-level American markets, including Atlanta, Chicago, Cincinnati, Cleveland, Las Vegas, Philadelphia and Phoenix.