NEW YORK (TheStreet) -- Shares of Six Flags Entertainment Corp (SIX) are rising, up 2.05% to $49.89 in early market trading Friday, after analysts at Wedbush initiated coverage of the company this morning.
The firm set an "outperform" rating on the amusement park operator with a price target of $58.
Wedbush analysts noted that they believe Six Flags will continue to grow at a faster rate than its competitors, in both the domestic and international markets.
The firm noted that Six Flags has the potential to "exceed the $600 million in modified EBITDA targeted for 2017."
Grand Prairie, Texas-based Six Flags Entertainment owns regional theme, water and zoological parks with thrill rides, water attractions, themed areas, concerts and shows, restaurants, game venues and retail outlets.
The company operates about 18 parks throughout the U.S., Mexico, and Canada.
Separately, TheStreet Ratings team rates SIX FLAGS ENTERTAINMENT CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate SIX FLAGS ENTERTAINMENT CORP (SIX) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 7.4%. Since the same quarter one year prior, revenues rose by 15.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, SIX FLAGS ENTERTAINMENT CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has increased to -$52.50 million or 12.35% when compared to the same quarter last year. In addition, SIX FLAGS ENTERTAINMENT CORP has also vastly surpassed the industry average cash flow growth rate of -68.57%.
- SIX FLAGS ENTERTAINMENT CORP's earnings per share declined by 17.2% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, SIX FLAGS ENTERTAINMENT CORP reported lower earnings of $0.73 versus $1.20 in the prior year. This year, the market expects an improvement in earnings ($1.57 versus $0.73).
- The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry average. The net income has decreased by 14.9% when compared to the same quarter one year ago, dropping from -$61.20 million to -$70.33 million.
- You can view the full analysis from the report here: SIX Ratings Report