If anyone can stomach travel this winter, it's probably the type of person who hurtles down mountainsides at breakneck speed for fun and excitement. This is why a few ski stocks might peak. While it's still too early to get a read on this year's snowfall -- Colorado has seen a few inches of powder and parts of California have gotten a dusting -- skiers are making plans. And even with travel fears compounding seemingly by the day, lowering traffic in some spots, analysts say the season still holds potential. "Mountain resorts are widely viewed as safe places to travel," said Stephen Forgacs, a spokesman for Intrawest , which operates resorts in the U.S. and Canada. Further, skiers and snowboarders tend not to be the mostcautious types. "Many of them are 25 to 35 years old and less influenced by political instability," he said. Business is down slightly from last year, reports Charles Unagast, store manager of Princeton Ski Shop in Elmsford, N.Y. "But it's better than we expected it to be right now," he said. From what he's heard, local skiers are planning day trips, rather than longer journeys. That's a trend that could be exacerbated by Monday's airline disaster in New York. Nevertheless, for travelers who are willing to go the distance, there are deals to be had. Web sites are offering discounted rates for lodging and savings on lift tickets, too.
In evaluating ski companies, analysts look to so-called "resort EBITDA," or earnings before interest, taxes, depreciation and amortization. This measure excludes real estate and other investments. And it corrects for the effect of seasonality on quarterly results. Vail currently trades at 6.7 times resort EBITDA, according to Bryan Maher, an analyst at Credit Lyonnais. He thinks the shares are worth 8.5times resort EBITDA, leading to his 12-month price target of $24. Maher rates the stock a buy. Credit Lyonnais has a banking relationship with Vail and Intrawest. Vail owns four Colorado ski resorts including Vail Mountain, Beaver Creek, Breckenridge and Keystone, as well as the Grand Teton Lodge in Wyoming. Close to 50% of the visitors to Vail resorts are "front-range" skiers, meaning they come by car. This year, the resort will target such travelers more than ever.