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On Tuesday, Guggenheim analyst Curry Baker revised the price target for Six Flags (NYSE:SIX) Entertainment (NYSE: FUN) to $50.00, down from the previous target of $55.00, while still recommending the stock as a Buy. With a market capitalization of $4.06 billion and impressive revenue growth of 50.6% over the last twelve months, Six Flags remains a significant player in the entertainment sector. According to InvestingPro data, analysts expect both sales and net income growth this year, despite the company’s fourth-quarter earnings showing revenue at $687 million and modified EBITDA at $209 million, which slightly missed Guggenheim’s expectations of $712 million in revenue and $213 million in EBITDA.
The recent quarter’s results were affected by a reduction of 37 operating days at the legacy Cedar Fair (NYSE:FUN) parks due to a shift in the fiscal calendar, leading to 576,000 fewer visits compared to the fourth quarter of 2023. However, when accounting for the calendar shift, attendance at legacy Cedar Fair parks would have seen an increase of 461,000, buoyed by strong demand in October. Six Flags’ management has provided a forecast for 2025, projecting adjusted EBITDA to be between $1.08 billion and $1.12 billion, aligning closely with Guggenheim’s estimate of $1.096 billion. InvestingPro analysis indicates the stock’s beta of 1.55 suggests higher volatility than the market average, which investors should consider when evaluating the company’s growth prospects.
Management also reported positive trends for the early part of 2025, noting a 2% rise in attendance, a 3% increase in season pass sales, and no significant impact from California wildfires on its parks. Six Flags aims to focus on driving attendance, especially at its legacy parks, throughout 2025, which may exert a slight pressure on admission per capita revenue.
The company is currently working on integrating the operations of its legacy parks, with $50 million in cost synergies realized in 2024 and expectations to achieve over $70 million in 2025. Key initiatives for this year and the next include improving guest experiences, achieving cost synergies for margin expansion, making disciplined park investments for free cash flow efficiency, integrating technology platforms, and reducing net leverage. Despite the lowered price target, Guggenheim’s outlook on Six Flags remains positive, underpinned by the company’s ongoing strategic initiatives and management’s guidance.
In other recent news, Six Flags Entertainment reported a 1% year-over-year growth in revenue for the fourth quarter, along with a significant expansion in adjusted EBITDA margins by approximately 466 basis points. The company introduced its 2025 guidance, predicting revenue growth between 2% and 6%, and an increase in adjusted EBITDA margins by 50 to 120 basis points. Oppenheimer has reiterated its Outperform rating on Six Flags with a price target of $60, citing a positive outlook and the potential sale of smaller parks to focus on larger, more profitable ones. Stifel analysts also increased their price target to $64, maintaining a Buy rating despite challenges following the merger with Cedar Fair. Six Flags announced its intention to exercise an end-of-term purchase option for Six Flags Over Georgia and Six Flags White Water Atlanta, with a potential payout of $332.6 million for the limited partnership units. The company’s 2025 Annual Meeting of Stockholders is scheduled for June 25, 2025, marking the first meeting since its name change from CopperSteel HoldCo, Inc. These developments reflect Six Flags’ strategic initiatives and management’s efforts to navigate post-merger complexities and enhance its market position.
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