FUN Stock Heads For 4Th Week Of Loss: Analyst Sees 29% Downside Ahead Of Earnings As Mounting Debt, Weak Sales Loom

(MENAFN- AsiaNet News)

• Mizuho cut Six Flags' price target to $5 from $10, citing weak sales and rising debt. 
• Six Flags reported a $202.6 million Q2 loss, and its stock has fallen 84% from its July 2024 peak. 
• Guggenheim cut its Six Flags price target to $17 from $28 but maintained a Buy rating. 

Six Flags Entertainment Corp. (FUN) stock is heading for a fourth straight week of losses as Mizuho slashed its price target to $5 from $10, implying 29% downside ahead of third-quarter (Q3) earnings. Weak sales, mounting debt, limited cash generation and high-cost borrowing add to investor concerns, while unfavorable weather threatens attendance. 

Six Flags Entertainment stock inched up 0.3% overnight Wednesday, after a 10% slump in the regular session. The stock has plunged 35% so far this month. 

Six Flags Faces Financial And Operational Challenges 

Mizuho lowered its price target for Six Flags Entertainment to $5 from $10 and kept its 'Underperform' rating. This suggests the stock could fall another 29%, as the company struggles with weak sales and rising debt. The analyst said Six Flags isn't bringing in enough cash and relies on borrowed money to cover seasonal costs. Its plan to spend $370 million to buy Six Flags Over Georgia has also raised concerns about its financial health.

Mizuho expects Six Flags may need to borrow money at high interest rates, increasing its costs. The company has not made a profit since its $8 billion merger with Cedar Fair in summer 2024. Its stock has plunged  84% from its July 2024 peak.

Six Flags reported a $202.6 million loss in Q2, more than twice the roughly $100 million loss a year earlier. The company also faced $102 million in debt payments, adding to its financial pressure. The company is scheduled to report its Q3 earnings on Nov. 5.  

Guggenheim Trims FUN Price Target Following Weather Disruptions

Guggenheim analyst Curry Baker also lowered his price target on Six Flags to $17 from $28. However, Baker retained a 'Buy' rating, taking a more optimistic stance than Mizuho.

The analyst adjusted his outlook to reflect weaker-than-expected trends during Q3, partly because of poor weather. He also reduced Q4 estimates, citing poor weather conditions in October and negative publicity surrounding the company.

Last week, a man fell from Six Flags Over Georgia's 200-foot Goliath roller coaster and died. The company has since shut down the ride and eight similar attractions at other parks, adding to its operational challenges.

FUN Stock: Retail View 

On Stocktwits, retail sentiment around the stock flipped to 'bullish' from 'bearish.'

A user said,“Although Warren Buffett advised to buy stocks when there is "blood in the streets" - in this case, there really was blood on the amusement park street and the uncertainty about legal ramifications is now growing.”Another user said,“The way this is free falling at this point i would probably vote in favor of a $10.5 a share take over bid crazy to think how far its fallen in a few short weeks.” 

FUN stock has crashed 53% year-to-date.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

MENAFN21102026007385015968ID1111847249