Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, theme park operator Six Flags Entertainment
With that in mind, let's take a closer look at Six Flags' business and see what CAPS investors are saying about the stock right now.
Six Flags facts
| Headquarters (founded) | Grand Prairie, Texas (1971) |
| Market Cap | $2.6 billion |
| Industry | Leisure facilities |
| Trailing-12-Month Revenue | $1 billion |
| Management | Chairman/CEO James Reid-Anderson CFO John Duffey |
| Return on Capital (average, past 3 years) | 3.3% |
| Cash/Debt | $231.4 million / $957.2 million |
| Dividend Yield | 5.2% |
| Competitors |
Cedar Fair Universal Parks & Resorts Walt Disney Parks and Resorts |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 26% of the 38 members who have rated Six Flags believe the stock will underperform the S&P 500 going forward.
Earlier this week, one of those bears, troym72, touched on the stock's seemingly unsustainable valuation:
Six Flags would have to increase their yearly EPS three-fold to justify the current trading price of $45 per share. Yes, I know that they just increased their dividend to [$0.60] per quarter giving a yield of 5%. ...
However, even with this dividend (which I question whether they can even afford to pay) ... the stock is still far overvalued in my opinion. Unless there is some major -- I mean major -- increase in profits on short order the price has to fall from here.
If you want market-topping returns, you need to protect your portfolio from any undue risk. Luckily, we've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.
Want to see how well (or not so well) the stocks in this series are performing? Follow the new TrackPoisedTo CAPS account.
