Six Flags Entertainment (NYSE:FUN) Releases Earnings Results, Misses Expectations By $5.52 EPS

Six Flags Entertainment (NYSE:FUN) issued its quarterly earnings results on Thursday. The company reported ($3.59) EPS for the quarter, missing the consensus estimate of $1.93 by ($5.52), FiscalAI reports. The company had revenue of $1.17 billion for the quarter, compared to the consensus estimate of $1.16 billion. Six Flags Entertainment had a positive return on equity of 7.43% and a negative net margin of 57.25%. The business’s revenue for the quarter was down 11.0% on a year-over-year basis. During the same period in the previous year, the business posted ($2.20) EPS.

Here are the key takeaways from Six Flags Entertainment’s conference call:

• Third-quarter same-park revenue rose 1.4% to $1.17 billion and Adjusted EBITDA increased 1.1% to $493 million, with the company holding a 42% margin despite weather challenges. Attendance was essentially flat, while per-capita spending increased 1.3% and fewer complimentary tickets improved attendance quality.
• For the first nine months, same-park Adjusted EBITDA grew about 11% to $639.5 million and margins expanded roughly 200 basis points. Reported free cash flow was $257 million, up about $300 million year over year, alongside $275 million of debt reduction and $1.06 billion in quarter-end liquidity.
• October attendance fell 9% year over year amid unfavorable weather and the Georgia incident and related ride closures; management expects fourth-quarter Adjusted EBITDA of $140 million-$150 million, down from $166.9 million a year earlier. The company still expects full-year same-park Adjusted EBITDA to grow, but described the October shortfall as a headwind.
• A guest died at Six Flags Over Georgia, prompting an investigation and a company-wide ride safety review supported by independent specialists. The company said some ride closures affected October visitation, while it could not yet comment further on the incident pending the investigation.
• Management cited a 7% year-over-year increase in the active pass base at September’s end and cross-park visits running about five times last year’s level. It is also reviewing parks and real estate for potential sales to reduce debt, while targeting mid-30% Adjusted EBITDA margins and net leverage of about four times over time.

Six Flags Entertainment Stock Performance

NYSE:FUN traded up $0.79 during mid-day trading on Friday, hitting $10.03. The stock had a trading volume of 11,218,551 shares, compared to its average volume of 5,953,021. The company has a current ratio of 0.42, a quick ratio of 0.36 and a debt-to-equity ratio of 43.34. The company has a 50 day simple moving average of $11.05 and a 200-day simple moving average of $16.73. The stock has a market capitalization of $1.03 billion, a price-to-earnings ratio of -1.10 and a beta of 0.50. Six Flags Entertainment has a 52 week low of $6.60 and a 52 week high of $26.28.

Key Six Flags Entertainment News

Here are the key news stories impacting Six Flags Entertainment this week:

• Positive Sentiment: Longer-term indicators improved: the active pass base grew 7% year over year, and free cash flow for the first nine months improved by $300 million. Six Flags: 3 Key Takeaways for Long-Term Investors
• Neutral Sentiment: Barclays lowered its price target from $22 to $13 but maintained an “overweight” rating; the new target implies 29.6% upside from the cited $10.03 price, though the sizable reduction reflects a more cautious valuation. Barclays stock recommendations
• Negative Sentiment: Third-quarter EPS was a loss of $3.59, far below analysts’ expected $1.93 profit. Revenue of $1.17 billion slightly topped estimates but fell 11% year over year. The company also cut its profit outlook after October setbacks, including attendance pressure following a fatal Georgia coaster incident, and announced a ride-safety review. Six Flags narrows losses, but October’s double blow forces profit outlook cut
• Negative Sentiment: Two law firms announced investigations into potential securities claims related to Six Flags, adding legal and reputational uncertainty for investors. Six Flags investors notified of securities fraud investigation

Insider Buying and Selling

In other news, CEO John Reilly purchased 15,713 shares of the company’s stock in a transaction on Wednesday, August 12th. The shares were bought at an average price of $15.80 per share, for a total transaction of $248,265.40. Following the completion of the purchase, the chief executive officer owned 297,736 shares of the company’s stock, valued at $4,704,228.80. This trade represents a 5.57% increase in their ownership of the stock. The purchase was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 2.10% of the company’s stock.

Analyst Upgrades and Downgrades

FUN has been the topic of several research reports. The Goldman Sachs Group restated a “neutral” rating and set a $9.00 price objective on shares of Six Flags Entertainment in a research note on Friday. Barclays lowered their price target on Six Flags Entertainment from $22.00 to $13.00 and set an “overweight” rating for the company in a report on Friday. Mizuho set a $5.00 price target on Six Flags Entertainment in a research report on Wednesday, October 21st. JPMorgan Chase & Co. reduced their price objective on Six Flags Entertainment from $26.00 to $22.00 and set a “neutral” rating on the stock in a research note on Tuesday, August 11th. Finally, Citigroup reduced their price objective on Six Flags Entertainment from $17.00 to $13.00 and set a “neutral” rating on the stock in a research note on Thursday, October 8th. Seven analysts have rated the stock with a Buy rating, seven have given a Hold rating and two have given a Sell rating to the company’s stock. Based on data from MarketBeat, Six Flags Entertainment currently has an average rating of “Hold” and an average price target of $15.85.

About Six Flags Entertainment

Six Flags Entertainment Corporation is a regional theme park operator headquartered in Charlotte, North Carolina. The company owns and operates amusement parks, water parks and resort properties, offering roller coasters, family rides, live entertainment, seasonal events, food and beverage, merchandise, and other guest experiences. Its portfolio includes parks operating under the Six Flags, Cedar Fair and affiliated brand names, including Six Flags Great Adventure, Cedar Point, Knott’s Berry Farm and Kings Island.

The company serves guests primarily in the United States, as well as in Canada and Mexico.