UPDATE: Wells Fargo Securities Initiates Coverage on Six Flags Entertainment Corp. with Outperform Rating
In a report published Friday, Wells Fargo Securities initiated coverage on Six Flags Entertainment Corp. (NYSE: SIX) with an Outperform rating.
Wells Fargo Securities noted, “Strong recurring revenue/free cash flow in an increasingly disciplined industry with high barriers to entry, offers consistent normalized growth and relative stability during economic weakness. Despite significant outperformance in SIX shares since emerging from bankruptcy in 2010, we believe additional EBITDA growth opportunities exist for SIX from (1) further enhancing the quality of the guest experience through focused product/service innovation, (2) data-based analytics revenue yield management, (3) targeted marketing, (4) a cost-conscious culture, and (5) disciplined capital expenditures. Executive and employee compensation remains aligned with shareholder interests. Recent $800MM debt issuance for $350MM of refinancing and to readjust capital structure to a likely peak 3.7x leverage ($450MM likely to be used for share repurchase over the next 18 months). Valuation likely to expand to 11.8-12.2x EV/EBITDA and roughly 6% dividend yield to our 2014 respective estimates. Seasonal median stock returns versus S&P 500 December-March +1000bps.”
Six Flags Entertainment Corp. closed on Thursday at $60.20.
Latest Ratings for SIX
|Jun 2014||Credit Suisse||Maintains||Outperform|
|Mar 2014||Credit Suisse||Maintains||Outperform|
|Nov 2013||FBR Capital||Initiates Coverage on||Market Perform|
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