ALK - Alaska Air: Held Back By Post-Merger Turbulence
Investment Thesis
Alaska Air Group, Inc. (ALK) owns Alaska Airlines and Horizon Air along with McGee Air Services, an aviation services provider. Serving mainly the West Coast of the US, ALK has its largest number of departures from Seattle, Portland and the Bay Area where it competes with United Continental Holdings, Inc. (UAL)-owned United Airlines and Delta Airlines, Inc. (DAL).
In 2016, ALK fully acquired its premium-branded competitor, Virgin America Inc. (VA) in an all-cash deal worth $2.6 bn, combining its presence in Pacific Northwest with VA’s route network mainly based in California. Despite becoming