Six Flags Entertainment (NYSE:FUN) Announces Earnings Results

Six Flags Entertainment (NYSE:FUN) released its earnings results on Thursday. The company reported ($3.59) earnings per share for the quarter, missing analysts’ consensus estimates of $1.93 by ($5.52), FiscalAI reports. The business had revenue of $1.17 billion during the quarter, compared to analysts’ expectations of $1.16 billion. Six Flags Entertainment had a positive return on equity of 7.43% and a negative net margin of 57.25%. The company’s revenue for the quarter was down 11.0% compared to the same quarter last year. During the same period last year, the business earned ($2.20) earnings per share.

Here are the key takeaways from Six Flags Entertainment’s conference call:

• Third-quarter same-park revenue rose 1.4% to $1.17 billion and Adjusted EBITDA increased 1.1% to $493 million, with the company holding a 42% margin despite weather challenges. Attendance was essentially flat, while per-capita spending increased 1.3% and fewer complimentary tickets improved attendance quality.
• For the first nine months, same-park Adjusted EBITDA grew about 11% to $639.5 million and margins expanded roughly 200 basis points. Reported free cash flow was $257 million, up about $300 million year over year, alongside $275 million of debt reduction and $1.06 billion in quarter-end liquidity.
• October attendance fell 9% year over year amid unfavorable weather and the Georgia incident and related ride closures; management expects fourth-quarter Adjusted EBITDA of $140 million-$150 million, down from $166.9 million a year earlier. The company still expects full-year same-park Adjusted EBITDA to grow, but described the October shortfall as a headwind.
• A guest died at Six Flags Over Georgia, prompting an investigation and a company-wide ride safety review supported by independent specialists. The company said some ride closures affected October visitation, while it could not yet comment further on the incident pending the investigation.
• Management cited a 7% year-over-year increase in the active pass base at September’s end and cross-park visits running about five times last year’s level. It is also reviewing parks and real estate for potential sales to reduce debt, while targeting mid-30% Adjusted EBITDA margins and net leverage of about four times over time.

Six Flags Entertainment Trading Up 8.5%

Shares of Six Flags Entertainment stock traded up $0.79 during mid-day trading on Friday, hitting $10.03. The stock had a trading volume of 11,218,551 shares, compared to its average volume of 5,953,021. The firm has a 50-day moving average of $11.05 and a two-hundred day moving average of $16.73. The firm has a market cap of $1.03 billion, a P/E ratio of -1.10 and a beta of 0.50. The company has a quick ratio of 0.36, a current ratio of 0.42 and a debt-to-equity ratio of 43.34. Six Flags Entertainment has a 12-month low of $6.60 and a 12-month high of $26.28.

Wall Street Analyst Weigh In

Several equities research analysts recently commented on the company. UBS Group cut their price target on Six Flags Entertainment from $27.00 to $18.00 and set a “buy” rating for the company in a report on Friday, October 16th. Citigroup reduced their price objective on Six Flags Entertainment from $17.00 to $13.00 and set a “neutral” rating on the stock in a research report on Thursday, October 8th. Stifel Nicolaus set a $15.00 price objective on Six Flags Entertainment in a research note on Thursday. Guggenheim dropped their target price on Six Flags Entertainment from $28.00 to $17.00 and set a “buy” rating for the company in a report on Wednesday, October 21st. Finally, The Goldman Sachs Group reaffirmed a “neutral” rating and issued a $9.00 target price on shares of Six Flags Entertainment in a research note on Friday. Seven research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat.com, Six Flags Entertainment has a consensus rating of “Hold” and an average target price of $15.85.

Insider Activity at Six Flags Entertainment

In other news, CEO John Reilly purchased 15,713 shares of Six Flags Entertainment stock in a transaction dated Wednesday, August 12th. The shares were purchased at an average price of $15.80 per share, with a total value of $248,265.40. Following the transaction, the chief executive officer owned 297,736 shares in the company, valued at $4,704,228.80. This represents a 5.57% increase in their ownership of the stock. The purchase was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders own 2.10% of the company’s stock.

More Six Flags Entertainment News

Here are the key news stories impacting Six Flags Entertainment this week:

• Positive Sentiment: Longer-term indicators improved: the active pass base grew 7% year over year, and free cash flow for the first nine months improved by $300 million. Six Flags: 3 Key Takeaways for Long-Term Investors
• Neutral Sentiment: Barclays lowered its price target from $22 to $13 but maintained an “overweight” rating; the new target implies 29.6% upside from the cited $10.03 price, though the sizable reduction reflects a more cautious valuation. Barclays stock recommendations
• Negative Sentiment: Third-quarter EPS was a loss of $3.59, far below analysts’ expected $1.93 profit. Revenue of $1.17 billion slightly topped estimates but fell 11% year over year. The company also cut its profit outlook after October setbacks, including attendance pressure following a fatal Georgia coaster incident, and announced a ride-safety review. Six Flags narrows losses, but October’s double blow forces profit outlook cut
• Negative Sentiment: Two law firms announced investigations into potential securities claims related to Six Flags, adding legal and reputational uncertainty for investors. Six Flags investors notified of securities fraud investigation

Six Flags Entertainment Company Profile

Six Flags Entertainment Corporation is a regional theme park operator headquartered in Charlotte, North Carolina. The company owns and operates amusement parks, water parks and resort properties, offering roller coasters, family rides, live entertainment, seasonal events, food and beverage, merchandise, and other guest experiences. Its portfolio includes parks operating under the Six Flags, Cedar Fair and affiliated brand names, including Six Flags Great Adventure, Cedar Point, Knott’s Berry Farm and Kings Island.

The company serves guests primarily in the United States, as well as in Canada and Mexico.