On Wednesday, Truist Securities increased its price target on shares of United Parks & Resorts (NYSE: PRKS) to $68.00, up from the previous target of $58.00. The firm has maintained a Buy rating on the stock.
The adjustment follows an analysis of various data sets, including Truist card spending, which indicates that demand trends for the company have been on an upswing throughout the second quarter and into early July.
The analyst noted that while there is a potential risk to the second quarter of 2024 per capita expectations due to promotions and mix, the focus on attendance growth, along with easier third-quarter comparisons, possible monetary easing, and current valuations, presents an attractive investment opportunity for the second half of the year for all park operators. Six Flags (NYSE:SIX) Entertainment Corp. is preferred ahead of earnings announcements, but there is perceived to be greater risk to United Parks & Resorts' second-quarter figures.
The firm has also updated its adjusted EBITDA estimates for Cedar Fair (NYSE: NYSE:FUN), another park operator, for the years 2024 and 2025 to $1.03 billion and $1.09 billion, respectively. These figures are up from the previous estimates of $1.01 billion and $1.07 billion. The revised price target for United Parks & Resorts reflects an 8 times multiple of the firm's projected 2025 EBITDA.
The report provides investors with updated financial forecasts and a new valuation benchmark for United Parks & Resorts, factoring in the company's recent performance and market conditions. The raised price target suggests a positive outlook for the stock's performance in the near future.
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