Frequent Flyer Elite Status Benefit: Get in On IPO Stock Pricing!

Virgin America is moving forward with an initial public offering of shares despite poor financial performance when the airline industry overall is doing well.

    virgin america ipo

Ultimately, Virgin America hasn’t succeeded because it doesn’t work to be a high cost, low fare carrier. And because they have neither the frequencies nor the reach to appeal to high fare business travelers.

Initial investors have waited far longer than expected to get some of their cash out, and the financial markets have recovered enough that there may just be an appetite for a Virgin America IPO to allow them to do so.

In the meantime Virgin America is pressing as hard as they can at the retail level — perhaps underscoring that the IPO isn’t exactly oversubscribed at the institutional level?

The Virgin America IPO will be offering these shares via Loyal3, a company frequent flyers will know as the brokerage that made it possible to buy stocks online with a credit card. Unfortunately, after many folks earned a ton of points buying a selling stock, they reduced the maximum purhcase amount. It’s a lot harder to earn miles buying and selling stocks off a credit card with $50 transactions than with $2500 transactions!

No doubt there are some folks who status matched over to Virgin America who will wish they had re-qualified. This is the first time I’m aware of IPO pricing access to elite frequent flyers. Although the reverse certainly existed as British Airways used to give airfare discounts to shareholders.


About Gary Leff


Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel – a topic he has covered since 2002.

Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the “World’s Top Travel Experts” by Conde’ Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Not all companies go up from the IPO price. I hope this isn’t a binding contract to employees and frequent flyers as that would suck to be stuck paying the IPO price and the stock tanks.

  2. Not sure why you imply there is some guarantee of profit from “getting in” on IPO price? Far from the truth.

  3. I got the email and will request $10k allotment. I went through their financial statement and prospectus – their metrics were fine. Not the best but at $1bil valuation, they’re only fetching 13 P/E compared to 16+ for other legacy airlines. Definitely undervalued.

  4. @tiveboy

    You mean that OTHER Billionaire who, by the way, is not a Billionaire but says he is with a left-wing media kiss, Elon Musk?

    Oil going to $50/barrel. Tesla going to $1 a share.

  5. This made me realize that it’s official that being an “Elevate Founding Member” will never be worth anything. Back when I got it they said it would mean *something*, but it never did. IMO, this would have been the right offer (although I definitely would NOT have taken it).

    In fact, I logged in just now and noticed that the status is gone from the website anyway!

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