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On Wednesday, Stifel analysts showed confidence in Six Flags (NYSE:SIX) Entertainment (NYSE: FUN), raising their price target on the company’s shares to $50.00, up from the previous target of $48.00, while sustaining a Buy rating. The stock, currently trading at $36.33, appears undervalued according to InvestingPro analysis. The adjustment followed an investor event where Six Flags’ executive team provided a detailed presentation on the company’s future.
During the event, Six Flags’ top executives, including the CEO, CFO, and CCO, outlined their long-term financial goals. By 2028, the company aims to achieve approximately $1.5 billion in adjusted EBITDA and around $600 million in free cash flow (FCF). These targets represent significant growth from current EBITDA of $705 million, though InvestingPro data shows the company operates with substantial debt obligations. These targets are based on expectations of increased attendance and higher guest spending, along with a more efficient cost structure.
Stifel analysts believe that the targets set by Six Flags for 2028 are on the conservative side or possibly moderate, rather than overly ambitious. They expressed trust in the management team’s conservative approach and long-standing reputation for setting realistic goals. According to the analysts, the company’s projections and the foundational elements of their financial strategy are deemed reasonable.
The investment firm remains bullish on Six Flags shares, suggesting that they are undervalued at their current market price. With analysts forecasting sales growth and profitability this year, according to InvestingPro, which offers 8 additional key insights about the company, Stifel anticipates that as investors delve deeper into Six Flags’ long-term strategy, there will be a broader recognition of the stock’s current undervaluation. This sentiment is underpinned by the view that Six Flags’ conservative financial projections and strategic planning position the company for sustainable growth.
In other recent news, Six Flags Entertainment has been the subject of various analyst assessments and strategic updates. UBS reaffirmed its Buy rating on the company with a steady price target of $49, emphasizing the management’s confidence in a 2-3% annual visitation increase by 2025. Stifel analysts also maintained a Buy rating, raising their price target to $50, citing a promising outlook for Six Flags’ financial targets, including $1.5 billion in adjusted EBITDA by 2028. Jefferies echoed a positive sentiment, slightly increasing their price target to $42 and highlighting the company’s ambitious growth projections, such as a 6% compound annual growth rate in revenue.
Conversely, JPMorgan adjusted its outlook more conservatively, reducing the price target significantly to $28 while maintaining an Underweight rating, pointing to potential risks in attendance and pricing pressures. Stifel, in a separate note, revised its price target down to $48, yet remained optimistic about the company’s long-term prospects despite a market sell-off. The merger with Cedar Fair (NYSE:FUN), forming a combined entity with 42 parks, has been noted as a strategic move, though analysts like JPMorgan caution about the integration challenges and capital expenditure needs. Despite varying price targets, Six Flags’ focus on enhancing guest experiences and strategic growth initiatives remains a focal point for analysts and investors alike.
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