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Vail Resorts (MTN) Q2 Earnings and Revenues Beat Estimates

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Vail Resorts, Inc. (MTN - Free Report) reported better-than-expected results in second-quarter fiscal 2019. Adjusted earnings of $5.02per share beat the Zacks Consensus Estimate of $4.91 by 2.2%. However, it declined 11.5% from the year-ago quarter.

Quarterly revenues of $849.6 million surpassed the consensus mark of $826 million and increased 15.7% on a year-over-year basis.

Following the results, shares of the company gained as much as 7% on Mar 8. Total revenues were favored by growth in each segment. Also, Vail Resorts’ season pass and large ski offerings have driven incremental growth.

Vail Resorts, Inc. Price, Consensus and EPS Surprise

 

Segment Results

Vail Resorts has two reporting segments — Mountain (91.4% in second-quarter fiscal 2019) and Lodging (8.6%).

The Mountain segment reported revenues of $776.1 million in the quarter, up 15.7% year over year mainly driven by higher sales from Triple Peaks and Stevens Pass and increased lift, ski and rental revenues.

EBITDA increased to$352.2 million or 15.4% for the segment from the prior-year quarter. Operating expenses at the Mountain segment totaled $424 million, up 15.9% year over year.

Lodging net revenues in the reported quarter were$73.2 million, up 15.3% year over year on an increase in hotel room and dining sales.

Under the segment, EBITDA increased to $5.8 million or 57% from the prior-year quarter. Operating expenses at the Lodging segment rose12.7% year over year to $67.5 million.

Operating Results

Vail Resorts’ resort reported EBITDA gain of $358 million in the quarter under review compared with $309 million a year ago.

Resort operating expenses totaled $491.5 million, up 6.8% year over year. Total segment operating expenses increased 6.6% year over year to $492.9 million.

Balance Sheet

Cash and cash equivalents as of Jan 31, 2019, came in at $158.6 million. Net long-term debt as of Jan 31, 2019, was $1,345 million.

The company approved an increase in quarterly cash dividend of 20% to $1.76 per share, which will be payable on Apr 11, 2019, to shareholders on record as of Mar 27, 2019.

In the second quarter of fiscal 2019, the company repurchased 155,111 shares at an average price of $225.64 for a total of approximately $35 million.

Fiscal 2019 Guidance

For fiscal 2019, Vail Resorts’ resort EBIDTA is estimated at $690-$710million, down from the previously announced range of $718-$750 million. Net income is projected in the range of $268-$300 million.

Zacks Rank & Stocks to Consider

Vail Resorts currently carries a Zacks Rank #4 (Sell).

A few better-ranked stocks from the leisure space are H.I.S. Co., Ltd. (HISJF - Free Report) , Lindblad Expeditions Holdings Inc. (LIND - Free Report) and Live Nation Entertainment, Inc. (LYV - Free Report) .

While H.I.S. Co. sports a Zacks Rank #1 (Strong Buy), Lindblad Expeditions and Live Nationcarry a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

H.I.S Co. has an expected earnings growth rate of 12.7% for the year 2020.

Lindblad Expeditions has an expected earnings growth rate of 34.1% for the year 2020.

Live Nation has anexpected earnings growth rate of 55% for the year 2020.

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