“Our previous view that MTN would suffer from demand hurdles in fiscal 2021, [which ended July 31] was wrong,” wrote KeyBanc analyst Brett Andress.
“Looking into fiscal year 2022, destination demand indicators for this upcoming season are above pre-pandemic levels, even with Delta in the background.”
Further, “more importantly, metrics we use to track intra-quarter pass sales appear robust, painting a path for unit sales to compare healthy vs. fiscal year 2020 levels,” Andress said.
“All in all, we see a favorable event path in the near term (pass sales, ski demand setup, estimates’ upside potential).”
Vail on Tuesday traded at $312.17, up 0.7% at last check.
“The data points to record occupancy levels for Thanksgiving and (more importantly) Christmas/New Year’s, with Martin Luther King Day in line vs. history and Presidents' Day sitting at new records,” Andress said.
“We’ve yet to find a great mousetrap to gauge intra-quarter pass sales, but two basic proxies (website traffic and search trends) support elevated demand for pass sales into the most recent Labor Day deadline.”
That’s “well above 2019, or in some cases on par with 2020, giving us confidence that MTN’s pass sales update is setting up for potentially modest unit declines off the up 50% vs. 2019 reported back in June,” Andress said.
“If true, this could equate to pass dollars up more than 30% vs. 2019 and be a driver of potential upside, simply using MTN's fiscal year 2020 pre-pandemic guide as a baseline.”