SeaWorld Brand Sentiment Has Fallen, But The Stock Could Still Be A Buy

In a report issued Thursday, Credit Suisse analysts Joel Simkins, Benjamin Chaiken and Christie Fredericks reiterate an Outperform rating and $27.00 price target on shares of SeaWorld Entertainment Inc SEAS, even though online sentiment experienced a considerable shift in July, becoming more negative.

Related Link: SeaWorld Set For A Turnaround?

So, what happened last month?

It seems like brand impairment issues were amplified from “allegations that a SeaWorld employee acted as an undercover member of activist group PETA, and after One Direction lead singer, Harry Styles, urged all of his fans to boycott SeaWorld during a concert in San Diego.”

While this could take a toll on the company’s main demographic in San Diego, the experts don’t think it is too late for it to correct brand damage issues, especially as the reputation campaign it launched in March gains traction. The analysts also think Orlando and other markets outside of San Diego remain relatively healthy and will profit from a more robust consumer environment.

In fact, Simkins, Chaiken and Fredericks remain confident on SeaWorld’s future, noting that several other companies have recovered from similar situations. In addition, they highlight the importance of new attractions, a novel strategic vision and a robust US consumer backdrop in offsetting any near-term feebleness.

Shares of SeaWorld are trading up more than 1 percent on Thursday.