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Investing.com - Six Flags (NYSE:SIX) Entertainment (NYSE:FUN) had its price target reduced by Stifel from $50.00 to $43.00 on Friday, while the firm maintained its Buy rating on the stock. Trading at $29.44, the theme park operator appears undervalued according to InvestingPro analysis, despite falling nearly 34% over the past six months.
Stifel analyst Steven Wieczynski cited "horrible" weather trends during the second quarter of 2025 across most of Six Flags’ operating locations, which significantly impacted visitor numbers at the theme park operator’s properties. InvestingPro data shows three analysts have recently revised their earnings expectations downward, though sales growth is still anticipated for the current year.
The firm noted that third-quarter weather conditions have not shown much improvement so far, though it is still early in the period. Based on these ongoing weather challenges, Stifel believes there is "little chance" Six Flags can maintain its full-year EBITDA guidance.
Despite the lowered price target, Stifel maintained its Buy rating, suggesting the market has already priced in both the anticipated second-quarter earnings miss and potential guidance reduction. The firm characterized the upcoming earnings release as a "full-blown clearing event" that would put the weather and guidance concerns to rest for the 2025 operating season.
Stifel emphasized that visitor spending and attendance patterns on days with normal weather conditions remain "strong/robust," and argued that investors are too focused on near-term results while underestimating Six Flags’ long-term free cash flow potential once park renovations are completed.
In other recent news, Six Flags Entertainment has faced a series of challenges impacting its financial outlook and operational performance. Guggenheim recently lowered its revenue forecast for the second quarter to $1.045 billion, attributing the decline to weather challenges affecting park attendance. UBS also adjusted its price target for Six Flags to $40, citing weak attendance during key periods such as June and the July 4th weekend. Similarly, Mizuho (NYSE:MFG) reduced its price target to $36, highlighting concerns over soft attendance figures and their impact on the company’s status within its coverage universe.
S&P Global Ratings revised Six Flags’ credit outlook to negative, pointing to delayed debt reduction and weaker-than-expected operating performance. Despite these challenges, Oppenheimer maintained its Outperform rating with a $60 price target, although it adjusted its Q2 EBITDA estimate to $336 million due to adverse weather conditions. The company plans to invest $1 billion in capital spending over the next two years, focusing on new rides and technology improvements. Six Flags also aims to reduce its leverage below its policy target by the end of 2026, supported by potential asset sales such as the planned closure of Six Flags America in Maryland. Weather remains a significant factor, with many firms citing it as a key variable affecting performance.
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