Spirit Airlines (SAVEQ) has appointed Dave Davis as its new CEO as the discount carrier emerges from bankruptcy and rebuilds its board of directors.
Davis comes to Spirit Airlines from rival discounter Sun Country Airlines (SNCY), where he had been the chief financial officer (CFO) since 2018. He also previously worked as the CFO of Northwest Airlines before its merger with Delta Air Lines (DAL). Now, Davis is being tasked with rebuilding Spirit Airlines’ operations and reputation as it emerges from a Chapter 11 bankruptcy filing in the U.S.
The company has said that it plans to move away from its previous no-frills model and rebrand as a premium airline. It remains to be seen if Spirit Airlines can successfully rebrand after years of growing losses, failed mergers with other carriers, and a financial restructuring under bankruptcy protection.
High Expectations
Davis’ appointment as Spirit’s new CEO is effective on April 21 of this year and comes about a week after previous CEO Ted Christie stepped down. “Dave’s background at both Northwest Airlines and, more recently, at Sun Country Airlines, positions him well to lead Spirit’s continued transformation,” said Spirit Airlines board chair Robert Milton in a news release.
Spirit Airlines filed for bankruptcy protection from its creditors last November, following years of losses and heavy debt. The carrier had been in merger talks with both Frontier Group (ULCC) and JetBlue Airways (JBLU), but neither deal ended up succeeding. SAVEQ stock has risen 35% this year.
Is DAL Stock a Buy?
Most analysts no longer cover bankrupt Spirit Airlines. So instead, we’ll look at competitor Delta Air Lines, whose stock has a consensus Strong Buy rating among 15 Wall Street analysts. That rating is based on 12 Buy and three Hold recommendations assigned in the past three months. The average DAL price target of $60.00 implies 46.88% upside from current levels.
