Shares in Six Flags Entertainment (FUN) edged higher on Tuesday despite the theme-park operator tapping the bond market for $1 billion in new senior notes to refinance debt maturing next April.
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The North Carolina-based company announced that it is raising the funds through a private placement to institutional investors — the notes are due by 2032. Buyers could be offered interest rates of up to 9%, with the fundraising effort expected to be wrapped up on Thursday, Bloomberg reported, citing a person familiar with the matter.
The outlet also noted that the offering has been rated Caa1 by Moody’s Ratings (MCO). This rating falls under the global credit ratings agency’s high-yield speculative grade ranking for long-term debt obligations. It describes debt in poor standing and very high credit risk, thus making such notes “junk” bonds.
Six Flags Struggles Post-Merger
This deal comes at a challenging time for Six Flags, which became the largest regional amusement park operator in North America in July 2024 following its $8 billion merger with Cedar Fair Entertainment. In its Q3 2025 earnings results released in November, the park operator posted a loss of $1.2 billion.
Six Flags blamed the performance on weak returns from its advertising spend and the drag from underperforming parks. Analysts note that the company is now focusing on exiting underperforming parks, reducing leverage on its balance sheet, and directing capital to high‑return projects.
This week, Six Flags disclosed it decided against buying the remaining partner stakes in the Six Flags Over Texas park in Arlington, Texas, calling it “a difficult and deliberate decision.” John Reilly, Six Flags’ president and CEO, described the park as “a prized asset within our portfolio” but noted that terms of the contract do not currently align with the firm’s capital allocation priorities.
Six Flags, which recently opened its first park outside North America in Saudi Arabia, is also battling an exodus of executives. Reilly joined the park operator as chief executive in November, replacing Richard Zimmerman, who stepped down from the position.
Is FUN a Good Stock to Buy?
On Wall Street, Six Flags Entertainment’s shares currently carry a Moderate Buy consensus rating from analysts based on eight Buys, two Holds, and one Sell issued over the last three months.
However, the average FUN price target of $23.89 implies over 59% upside from current trading levels.
