Spirit Airlines (NASDAQ:SAVE) stock rocketed higher by more than 153% in 2013. This made it the biggest gainer in one of the top-performing industry sectors this year, outshining strong performances from Delta Air Lines (NYSE:DAL) and Southwest Airlines (NYSE:LUV).

SAVE Chart

2013 Airline Stock Chart, data by YCharts

Spirit Airlines stock has benefited from the company's rapid earnings growth in 2013. (Analysts currently expect Spirit to post EPS of $2.31 for this year, up from $1.43 last year.) Longer-term consolidation in the airline industry has put Spirit in position for massive growth. While Spirit stock is unlikely to double again in 2014, it still remains one of the most appealing investment opportunities in the airline industry.

The lowest fares in the U.S.
Spirit Airlines has made its name by becoming the clear price leader in the U.S. airline market. Spirit's policy of "unbundling" fares -- charging extra for everything from bringing a large carry-on bag to choosing a seat in advance -- allows it to offer extremely low base fares.


Spirit Airlines is the price leader in the U.S. airline industry today (Photo: Spirit Airlines)

Even including optional fees, Spirit Airlines typically offers the lowest total price for the routes it serves. Since the vast majority of fliers are price-conscious, and many are willing to sacrifice comfort for lower fares, Spirit fills its planes consistently despite "nickel-and-diming" customers.

Moreover, Spirit's maniacal focus on keeping costs down has allowed it to achieve mid- to high-double-digit operating margins, something virtually unheard of in the airline business. Through the first nine months of 2013, not only did Spirit grow revenue by 24.7%, but it also expanded its operating margin from 14.3% to 17.4%.

Long runway for growth
Best of all for Spirit Airlines shareholders, the carrier has a long runway for growth. Earlier this year, Spirit boosted its aircraft order with Airbus, allowing it to maintain an annual growth rate of more than 15% (on average) through the end of the decade. Based on its current plans, Spirit Airlines will triple in size between today and the end of 2021.

The company should have no trouble maintaining its high margins even with all of this growth. Last month, Spirit increased its estimate of the number of additional domestic markets that meet its expansion criteria to 500.

Spirit's management has also pointed out that in 2021, the carrier's U.S. market share will still be less than half of Ryanair's European market share. This suggests that the U.S. "ultra-low-cost carrier" segment will remain in growth mode for quite some time. As the top carrier in that niche, Spirit Airlines is poised to lead the charge.

Foolish final thoughts
Spirit Airlines shareholders have made a boatload of money in 2013 as the company managed to deliver strong margin expansion despite rapid capacity growth. Investors obviously shouldn't expect to more than double their money every year, but Spirit still looks like a great long-term-growth stock.

The industry consolidation trend is encouraging very cautious capacity growth among the largest airlines in the U.S. This is in turn allowing them to raise prices. The more the major airlines boost their prices, the bigger Spirit's growth opportunity becomes. Its business model of low-cost and low-base fares allows it to stimulate travel demand among people who would not be able to fly much (or at all) at major airline prices.

Based on current industry trends, there are no major clouds on the horizon for Spirit Airlines. There will always be budget-minded travelers, and few if any other airlines can profitably match Spirit's prices. That's a solid recipe for continued outperformance.

Fool contributor Adam Levine-Weinberg has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.