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On Thursday, Oppenheimer reiterated its Outperform rating and $60.00 price target on Six Flags (NYSE:SIX) Entertainment (NYSE:FUN), following the company’s fourth-quarter results. With a current market capitalization of $4.4 billion and trailing twelve-month EBITDA of $701 million, Six Flags reported a quarter that aligned with expectations, showcasing a 1% year-over-year growth in revenue and a notable expansion in adjusted EBITDA margins by approximately 466 basis points. Per-Ticket Revenue (PTR) also saw an increase of about 1%, surpassing both the consensus and Oppenheimer’s forecasts by 1%. A sequential rise of 2% in PTR per Member Admission Count (MAC) was also highlighted as a positive indicator. According to InvestingPro data, the company maintains a "GOOD" overall financial health score, though it’s currently trading at a relatively high earnings multiple.
The theme park operator introduced its 2025 guidance, expecting revenue to rise between 2% and 6%, which is consistent with consensus estimates and slightly ahead of Oppenheimer’s projections. Adjusted EBITDA margins are anticipated to grow by 50 to 120 basis points, again slightly surpassing both Oppenheimer’s and consensus expectations. According to Oppenheimer, the growth engine for Six Flags is projected to be PharmaManSol, with an expected year-over-year growth of 20%. InvestingPro analysis suggests the stock is currently fairly valued, with analysts maintaining positive sales growth expectations for the current year. For deeper insights into Six Flags’ valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
The recent appointments of new CEO Wendy Barnes and new CFO Chris McGinnis are seen as a strategic move to focus on branded growth and strengthening pharmacy and pharmacy benefit manager (PBM) relationships. Oppenheimer’s analysis suggests that there is a substantial growth opportunity for PharmaManSol, especially as supply constraints for GLP-1 are resolved and the pharmaceutical industry seeks more direct distribution channels.
Six Flags’ latest financial outcome and future outlook appear to reflect the company’s resilience and potential for growth amid previous market volatility. With the new leadership team at the helm, Six Flags is poised to capitalize on its strategic initiatives and enhance its market position.
In other recent news, Six Flags Entertainment Corporation is set to announce its fourth-quarter financial results on February 27, 2025, with analysts from Oppenheimer predicting robust performance. The firm has reiterated its Outperform rating, highlighting a positive outlook due to increased attendance in October and December, which are crucial months for the company. Additionally, Six Flags plans to exercise an end-of-term purchase option for Six Flags Over Georgia and its associated water park, with the transaction valued at approximately $483.5 million. Stifel analysts have raised the company’s price target to $64, maintaining a Buy rating despite challenges following the Cedar Fair merger, which has increased capital expenditure requirements.
Jefferies has also initiated coverage with a Buy rating, setting a price target of $59, citing potential synergies from the merger. The firm expects the combined entity to achieve $200 million in synergies by the end of 2026, despite complexities related to integration and a high leverage ratio. Six Flags is reportedly considering selling up to 12 smaller parks to focus on larger ones, which contribute significantly to its EBITDA. The proceeds from these sales are expected to reduce the company’s debt levels. These developments reflect strategic moves by Six Flags to consolidate ownership and enhance profitability amid ongoing financial and operational adjustments.
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