Shares are falling 3.4% to $102.69 on Tuesday.
This action comes after the mountain lodging and real estate company reported its third quarter earnings results yesterday. The company reported quarterly net income of $133.4 million, or $3.56 per diluted share.
While this was a 13% increase over the previous year, it was still lower than Barclays' consensus estimate of $3.73 per share for the latest quarter.
Poor conditions in Lake Tahoe and Utah drover skier visits down, according to the analyst note.
However, over the past several years, "Vail has encouraged skiers to purchase their skiing ahead of the season, which has helped the company generate consistent revenue growth despite a few historically bad snow years," analysts added.
Separately, TheStreet Ratings team rates VAIL RESORTS INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate VAIL RESORTS INC (MTN) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, compelling growth in net income and largely solid financial position with reasonable debt levels by most measures. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 17.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 37.36% is the gross profit margin for VAIL RESORTS INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 21.83% significantly outperformed against the industry average.
- Net operating cash flow has significantly increased by 71.82% to $249.71 million when compared to the same quarter last year. In addition, VAIL RESORTS INC has also vastly surpassed the industry average cash flow growth rate of -11.64%.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 95.3% when compared to the same quarter one year prior, rising from $59.26 million to $115.76 million.
- The debt-to-equity ratio is somewhat low, currently at 0.75, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.25 is very weak and demonstrates a lack of ability to pay short-term obligations.
- You can view the full analysis from the report here: MTN Ratings Report