We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Vail Resorts (MTN - Free Report) is a Zacks Rank #5 (Strong Sell) that operates mountain resorts and regional ski areas. The company operates 41 mountain resorts and ski areas.
The stock has traded sideways over the last year as investors wait for the snow to fall. However, short winter seasons have stalled this company’s growth and the stock is struggling to get back to the summit that was achieved in 2021.
About the Company
Vail Resorts was founded in 1845 and is based in Broomfield, CO. The company employs over 7,000 people and operates through three segments: Mountain, Lodging, and Real Estate.
The mountain segment was 88% of 2023 revenue, while lodging was close to 12% and Real Estate was 0.3%.
MTN is valued at $8 billion and has a Forward PE of 28. The stock holds Zacks Style Scores of “B” in Growth, but “F” in Value. After the company hiked the dividend, the stock pays a yield of about 4%.
Q2 Earnings
Vail Resorts has a difficult time beating earning expectations, with the company missing six quarters in a row.
On March 11th, the company posted another miss of 5%. Revenues came in below expatiations and Vail cut its FY24 outlook.
Total skiers were 7.26M v the 7.7M expected and RevPAR was down 4.4% y/y. EBITDA was higher versus last year, but the FY24 guide was lowered.
Management cited weather disruptions as a reason for the underperformance but was hopeful for the rest of March and April.
However, analysts do not seem to be convinced yet as estimates continue to trend lower.
Earnings Estimates
Over the last 30 days, earnings estimates for the current quarter have fallen from $10.69 to $10.08, a drop of 6%.
For the current year, estimates have dropped from $8.95 to $7.90, or 12% over that same time frame.
Next year does not look any better. Since EPS, earnings estimates have dropped from $10.45 to $9.70, a move lower of 7%.
While analysts drop estimates, their price targets remain in the 200-260 range. The stock is trading right in the middle of that range, as investors wait out the storm while collecting the dividend.
Technical Take
After COVID, the stock crashed to $125 as many resorts were shut down. However the demand to hit the slopes was high when the pandemic ended and the stock hit $375.
In early 2022 the stock fell to $200 and has since been in a trading range from $200-260.
Looking at moving averages, the stock is having trouble with the 200-day MA but is currently over the 50-day MA.
At best, the stock looks like dead money unless it can break out of the range. While some investors accept that idea with the 4% dividend, a move under $210 would put pressure on some to sell.
In Summary
Whether an investor pin’s fault of the weather challenges on climate change or bad luck, Vail has an issue getting people on the Mountain. While there are sporadic periods of good weather, it has been challenging to put together a good skiing season.
Until that trend changes, investors will avoid the stock and hide in the lodge, before hitting the slopes.
For those interested in the Leisure and Recreation space, a better option might be Royal Caribbean Cruises (RCL - Free Report) . The stock is a Zacks Rank #2 (Buy) that is trading close to 2024 highs.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Bear of the Day: Vail Resorts (MTN)
Vail Resorts (MTN - Free Report) is a Zacks Rank #5 (Strong Sell) that operates mountain resorts and regional ski areas. The company operates 41 mountain resorts and ski areas.
The stock has traded sideways over the last year as investors wait for the snow to fall. However, short winter seasons have stalled this company’s growth and the stock is struggling to get back to the summit that was achieved in 2021.
About the Company
Vail Resorts was founded in 1845 and is based in Broomfield, CO. The company employs over 7,000 people and operates through three segments: Mountain, Lodging, and Real Estate.
The mountain segment was 88% of 2023 revenue, while lodging was close to 12% and Real Estate was 0.3%.
MTN is valued at $8 billion and has a Forward PE of 28. The stock holds Zacks Style Scores of “B” in Growth, but “F” in Value. After the company hiked the dividend, the stock pays a yield of about 4%.
Q2 Earnings
Vail Resorts has a difficult time beating earning expectations, with the company missing six quarters in a row.
On March 11th, the company posted another miss of 5%. Revenues came in below expatiations and Vail cut its FY24 outlook.
Total skiers were 7.26M v the 7.7M expected and RevPAR was down 4.4% y/y. EBITDA was higher versus last year, but the FY24 guide was lowered.
Management cited weather disruptions as a reason for the underperformance but was hopeful for the rest of March and April.
However, analysts do not seem to be convinced yet as estimates continue to trend lower.
Earnings Estimates
Over the last 30 days, earnings estimates for the current quarter have fallen from $10.69 to $10.08, a drop of 6%.
For the current year, estimates have dropped from $8.95 to $7.90, or 12% over that same time frame.
Next year does not look any better. Since EPS, earnings estimates have dropped from $10.45 to $9.70, a move lower of 7%.
While analysts drop estimates, their price targets remain in the 200-260 range. The stock is trading right in the middle of that range, as investors wait out the storm while collecting the dividend.
Technical Take
After COVID, the stock crashed to $125 as many resorts were shut down. However the demand to hit the slopes was high when the pandemic ended and the stock hit $375.
In early 2022 the stock fell to $200 and has since been in a trading range from $200-260.
Looking at moving averages, the stock is having trouble with the 200-day MA but is currently over the 50-day MA.
At best, the stock looks like dead money unless it can break out of the range. While some investors accept that idea with the 4% dividend, a move under $210 would put pressure on some to sell.
In Summary
Whether an investor pin’s fault of the weather challenges on climate change or bad luck, Vail has an issue getting people on the Mountain. While there are sporadic periods of good weather, it has been challenging to put together a good skiing season.
Until that trend changes, investors will avoid the stock and hide in the lodge, before hitting the slopes.
For those interested in the Leisure and Recreation space, a better option might be Royal Caribbean Cruises (RCL - Free Report) . The stock is a Zacks Rank #2 (Buy) that is trading close to 2024 highs.