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Why SeaWorld (SEAS) Stock Continues To Tank Today

Stocks in this article: SEAS

NEW YORK (TheStreet) -- Shares of SeaWorld Entertainment Inc. (SEAS) continue to fall as the stock is down -30.12% to $19.67 on very heavy trading volume on Wednesday.

SeaWorld, a large amusement park that showcases marine mammals for entertainment purposes, reported disappointing earnings results for the 2014 second quarter.

The company posted net income of $37.3 million, or 43 cents per share for the most recent quarter, while analysts expected earnings of 59 cents per share.

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Total sales declined by 1% to $405.2 million for the most recent quarter, below the $445 million analysts were expecting.

SeaWorld reported a 0.3% growth in attendance to 6.6 million for the quarter, from the 2013 second quarter, but said its attendance was “impacted by demand pressures related to recent media attention surrounding proposed legislation in the state of California.”

Two members of the U.S. House from California are proposing a study on how captivity can effect large marine mammals, the Wall Street Journal reported. A bill that would ban killer whale shows in the state is currently on hold until next year.

The proposal is a result of the 2013 documentary “Blackfish,” which alleges SeaWorld's orcas are physically and mentally traumatized due to prolonged captivity.

SeaWorld also cut its full year 2014 sales, expecting a decline between 6% and 7%, from the $1.46 reported for the full year 2013.

Analysts were expecting an increase to $1.5 billion for fiscal 2014.

Separately, TheStreet Ratings team rates SEAWORLD ENTERTAINMENT INC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:

"We rate SEAWORLD ENTERTAINMENT INC (SEAS) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow."

You can view the full analysis from the report here: SEAS Ratings Report

SEAS Chart SEAS data by YCharts

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