Stock market today: S&P 500 drops for fifth day as focus shifts to Powell’s speech
On Thursday, Stifel analysts, led by Steven Wieczynski, adjusted their outlook on Six Flags (NYSE:SIX) Entertainment (NYSE:FUN), reducing the price target on the company’s shares from $52.00 to $48.00, while reaffirming a Buy rating. The revision followed a market sell-off, which Wieczynski deemed excessively pessimistic, particularly given the focus on the company’s first-quarter performance for 2025. According to InvestingPro data, the stock has experienced a significant 24% decline over the past six months, with analyst targets ranging from $28 to $62 per share.
The analyst expressed the belief that the market overreacted to the first-quarter earnings miss by Six Flags, which he considered to be of limited consequence. Contrary to some concerns that the full-year EBITDA targets might now be more challenging to meet, Wieczynski suggested that the maintained guidance should be seen as a positive sign. He highlighted the conservative nature of Six Flags’ management, formerly of Cedar Fair, and their likely reluctance to set aggressive forecasts for the fiscal year 2025 amidst current market uncertainties. InvestingPro analysis shows strong revenue growth expectations of 23% for fiscal year 2025, with the company’s current EBITDA standing at $688 million.
Wieczynski also pointed to robust April and season pass metrics as indicators for a potentially strong finish to the fiscal year. Despite the "cloudy macro backdrop," which has led his team to factor in a moderate recession in their projections, he remains optimistic about the prospects of Six Flags.
The analyst further stated that Six Flags is one of the most undervalued stocks they cover, and he believes that the market has already factored in a near-worst-case scenario for the company. As such, Wieczynski recommends purchasing shares ahead of the company’s forthcoming investor event, suggesting that now is an opportune moment for investors to engage with the stock.
In other recent news, Six Flags Entertainment has been the focus of several analyst revisions and financial assessments. Mizuho (NYSE:MFG) Securities adjusted its price target for Six Flags to $49, maintaining an Outperform rating, and noted mixed financial performance in the company’s legacy businesses. Six Flags reported an EBITDA of $875.3 million for fiscal year 2024, with the legacy FUN segment showing a 5.5% growth, while the legacy Six Flags segment experienced a 6.7% decline. Jefferies also revised its price target to $42, keeping a Buy rating, and highlighted the impact of scheduling changes for the Boysenberry festival on the company’s quarterly performance. Stifel cut its price target to $52, yet maintained a Buy rating, emphasizing the potential resilience of theme park attendance despite economic pressures. Meanwhile, JPMorgan lowered its price target significantly to $28, maintaining an Underweight rating, and pointed out potential risks related to attendance recovery, pricing pressure, and capital expenditure needs. These recent developments reflect a range of perspectives on Six Flags’ financial outlook and strategic challenges.
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