Founded in by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Airline stocks soared in the second half of , led by two of the three biggest companies in the industry: American Airlines and United Continental.

Indeed, shares of American and United nearly doubled between late June and early December as investors started to gain confidence that unit revenue was ready to rise again after two years of steady declines. The shares of smaller airlines like Alaska Air NYSE: ALK , JetBlue Airways NASDAQ: JBLU , and Spirit Airlines NASDAQ: SAVE didn't rally nearly as much. Yet they have better long-term profit growth opportunities than their larger rivals. This makes them the three best airline stocks to buy for Last quarter, Alaska Air became one of the first U.

Including Virgin America's results for the full quarter, RASM would have been down 0.

The 3 Best Airline Stocks to Buy in -- The Motley Fool

Alaska Air returned to unit revenue growth near the end of Unit revenue is on track to decline modestly in the first quarter of , due in part to severe winter storms that hit the Pacific Northwest, as well as the timing of holidays. However, Alaska is in good position to return to RASM growth in Q2 as competitive capacity growth in its markets finally slows down. The rollout of Alaska Airlines' extra-legroom "Premium" seating this year will also contribute to RASM growth. Meanwhile, Alaska Air has started the integration process for its Virgin America acquisition.

The recent announcement that it will phase out the Virgin America brand made big headlines, but that won't happen until For now, Alaska is focused on driving revenue synergies by adding flights in Virgin America's hometown of San Francisco. It also continues to grow capacity at a high-single-digit rate. As a result, Alaska Air could potentially produce double-digit compound annual EPS growth over the next few years.

JetBlue Airways stock has struggled for the past year and a half as the company's unit revenue performance has cooled off. Like Alaska Air, JetBlue was hit hard this quarter by holiday calendar shifts.

JetBlue is slowing its growth during in order to stabilize unit revenue. Furthermore, it is about to accelerate the expansion of its Mint premium service. JetBlue's flat-bed Mint premium seats will come to more routes soon. Customers have fallen in love with the flat-bed premium seats JetBlue offers on several cross-country routes.

RASM has surged on JetBlue's first two Mint routes, which connect New York to San Francisco and Los Angeles. JetBlue successfully expanded Mint to its Boston-San Francisco and Boston-Los Angeles routes last year. Last week, JetBlue added a new cross-country Mint route connecting Fort Lauderdale to Los Angeles.

Six new Mint routes are on the horizon, all of which are likely to launch between now and mid As Mint grows as a proportion of JetBlue's capacity, unit revenue should trend higher.

Should You Follow Buffett's Lead And Buy Airline Stocks? | Seeking Alpha

JetBlue is also working to keep costs down. JetBlue will also start to retrofit its A fleet with additional seats later this year. With improving revenue and cost trends, JetBlue's profit margin is primed to rise again. As this starts to show up in the company's results -- probably in the second half of -- JetBlue stock could surge higher. Finally, Spirit Airlines has experienced the biggest unit revenue slump in the industry.

It's remarkable that Spirit earned a Fortunately, the unit revenue declines have been slowing for the past few quarters. However, Spirit has said that it expects RASM to return to growth next quarter and continue rising for the rest of the year.

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Spirit Airlines is on pace to return to unit revenue growth in Q2. Meanwhile, Spirit expects its non-fuel unit costs to decline modestly this year. And while fuel prices were up significantly year over year in the first quarter, the company will face much smaller fuel-price increases going forward. Spirit Airlines is working on numerous initiatives to produce steadier unit revenue increases in the future while keeping costs low.

This provides a solid foundation for the company's aggressive growth plans.

10 Best Airline Stocks for - Top Stocks - TheStreet Ratings

Alaska Air, JetBlue Airways, and Spirit Airlines all have far greater growth prospects than their larger rivals. They also tend to generate higher profit margins.

Yet their shares aren't trading at a significant premium right now. This makes Alaska, JetBlue, and Spirit the three best airline stocks to buy in The Motley Fool recommends JetBlue Airways and Spirit Airlines. The Motley Fool has a disclosure policy. He is an avid stock-market watcher and a value investor at heart. He primarily covers airline, auto, retail, and tech stocks.

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