The Glass Is 20% Full

I told you not to bet against Six Flags (NYSE: SIX  ) . The company updated its year-to-date performance last night. The results were generally positive, though off from the feverishly encouraging pace that the amusement park giant achieved during the first quarter.

Attendance came in flat, yet that is coming on 6% fewer operating days than at this point last year. Per capita spending is up by a healthy 5%. The end result is that the top line is clocking in with a 5% gain, but doing so on fewer days, with 80% of the operating season yet to come.

Sure, as year-to-date data it's all too easy to be disheartened in comparing the results to the blowout first-quarter report. Through the end of March, Six Flags was boasting a 20% uptick in revenue, despite working off of 10% fewer operating days. Attendance was up 6% and the average turnstile clicker was spending 13% more at the park. So what happened in April and May to drag down the performance?

Well, beyond flooding in Texas and a later start to the operating season in some of its Northern parks, one has to be a realist here. The first quarter was too small a sample -- accounting for just 5% of the season -- that has since quadrupled to 20% of the operating calendar.

The market took shares of Six Flags down in after-hours trading last night, but it's an impatient and impulsive move when everyone knows that turnarounds take time. Oh, and Six Flags is making significant improvements in the current operating season anyway for those looking to dish out a quick grade. The family-friendly makeover is working. Per capita spending is spiking for the second consecutive year. Season pass sales are also up by 10%, indicating that the repeat business public is encouraged by changes that CEO Mark Shapiro and his crew have been implementing.

The Six Flags news stacks up nicely against rival Cedar Fair (NYSE: FUN  ) , where last week's early season report found flat revenue growth with attendance dipping by 5%, offset by a 5% increase in per capita spending. Sure, Cedar Fair is working off 10% fewer operating days than at this point last year, but that's an encouraging sign to folks who can look ahead to see Easter coming in early on the 2008 calendar.

As seasonal chains, Six Flags and Cedar Fair have few properties in their portfolios that can take advantage of year-round operations like the Southern theme park staples owned by Disney (NYSE: DIS  ) . That can also be an advantage, especially to a company like Six Flags that recently raised some greenbacks by selling off some of its smaller parks.

The 2007 operating season is just getting started, even if Six Flags isn't brushing up on its senior year valedictorian speech while barely into its sophomore year.

Disney is a Stock Advisor recommendation. Cedar Fair is an Income Investor selection.

Longtime Fool contributor Rick Munarriz enjoys taking his family to amusement parks as often as possible. He owns shares in Disney and units in Cedar Fair. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


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