For many investors, the airline industry has been a notoriously difficult space to navigate over the years. With problems like a debilitating dependency on fluctuating fuel prices, exorbitantly high debt levels, and severe headline risk, the overall industry is not an investor-friendly one.

However, one of the best growth companies that I know of resides in the space, Alaska Air Group (ALK -1.66%). The small airliner has been growing in a big way recently and just announced the largest stock buyback in company history, which marks management's latest attempt at increasing shareholder value.

Source: Alaska Air 

Huge stock buyback
In its latest attempt to create value for shareholders, management at Alaska Air Group announced on May 12 that it would initiate the largest stock repurchase plan in the company's history. 

The massive $650 million buyback, which becomes effective immediately after the completion of the company's existing $250 million buyback, represents approximately 10% of Alaska Air Group's current market capitalization. 

Although the sheer size of the buyback is certainly impressive, perhaps more important is the consistency with which company management has been enacting repurchase plans in recent years. The most recent plan marks Alaska Air Group's eighth repurchase program since 2007. During that time, the company has purchased more than 21 million shares of its stock for $519 million. 

In the company's recent statement, Chairman and CEO Brad Tilden stated, "Our growing network, low fares, outstanding operational reliability, and the award-winning service delivered by our employees are producing excellent financial results and cash flows." 

He continued, "Like other high-quality companies, we're making value-creating investments in our business, and rewarding our owners by paying meaningful dividends and buying back our stock. We're confident in the future of Alaska Air Group and committed to building long-term shareholder value." 

Effective management
In the recent announcement, management also announced the company's next payable dividend of $0.25. While it wasn't an increase over the last one, the company is performing well in this regard as well. Alaska Air Group only began to pay out dividends to shareholders last year and management has already raised the company's dividend by 25% in that time. 

CEO Tilden explained, "Air Group intends to finance the dividend and stock repurchases with cash on hand and cash flow from operations." CFO Brandon Pedersen said. "Air Group will maintain its strong cash and liquidity position and low leverage as we return capital to our owners." 

This quote from CEO Tilden brings me to my next point; Alaska Air Group leads the industry in terms of many important financial metrics. The company has low debt and a high cash level. Alaska Air Group's $834 million debt equals only 12.4% of the company's market cap and its $1.42 billion in cash equals 21% of its market cap. 

When compared to industry competitors like JetBlue Airways (JBLU -1.27%), Alaska Air Group looks even better. JetBlue has $2.64 billion in debt, which is more than the company's entire market cap of $2.6 billion. 

Alaska Air Group's high return on invested capital metric also stands out at an impressive 18.1%. This means that management is very efficient at managing capital and allocating it to profitable investments. Meanwhile, JetBlue's ROIC stands at a meager 5.16%. 

The good news doesn't just stop there, though. Analysts also project that Alaska Air Group will match, for the most part, the growth of its much smaller competitor JetBlue this year. According to Yahoo! Finance, analysts expect Alaska Air Group to grow revenue 7.5% and EPS 31.1% in 2014 compared to 8.8% and 30.8% for JetBlue, respectively. 

Source: Alaska Air 

Bottom line
Alaska Air Group is the best investment in the airline industry because it is unlike most of the other companies operating in the space. Management has refused to take on large debt and instead remains committed to rewarding shareholders at seemingly every turn.

As the company continues to benefit from its expanding routes and loyal consumer base, investors can expect Alaska Air Group to continue to increase shareholder value going forward.