In a report released today, Thomas Yeh from Morgan Stanley downgraded Six Flags Entertainment Corporation to a Hold, with a price target of $20.00.
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Thomas Yeh has given his Hold rating due to a combination of factors impacting Six Flags Entertainment Corporation. The company has recently adjusted its 2025 guidance, which raises concerns about the timing and extent of its anticipated recovery in the following years. While there is potential for Six Flags to increase its earnings, the path to recovery is fraught with challenges, particularly due to unfavorable macroeconomic conditions and specific execution risks.
Yeh also notes that although there is strategic value to be unlocked, the company’s pricing power is weaker than expected. This, combined with growing concerns about low-end consumer spending and limited opportunities to improve results each season, adds uncertainty to the timeline for rebuilding attendance and revenue. Additionally, the company’s high leverage and the need for improved fundamentals contribute to the cautious outlook, leading to the Hold rating.