Spirit Grows To Grow

In its recent quarterly report, Spirit Airlines reported poor results. In a sharp criticism of company management, an analyst notes “growth for growth’s sake will not be rewarded in this environment.” Evidently, Spirit has yet to figure out that growth is only good if the new projects are positive NPV projects. In Spirit's case, the industry is experiencing weakening prices, yet Spirit continues to expand, with an announced capacity growth of more than 20 percent in 2016.