What happened

Vail Resorts (MTN 1.03%) trailed the market by a wide margin last month, shedding 25% compared to a 9% slump in the S&P 500, according to data provided by S&P Global Market Intelligence.

The decline ensured that the stock ended 2018 about where it started to mark a slight outperformance over the broader market's 6% drop.

A man holding skis

Image source: Getty Images.

So what

It didn't help that December was one of the worst months for U.S. equities in years. However, the mountain resort specialist added to the broader downbeat mood by announcing surprisingly weak quarterly results. Sales declined in the fiscal first quarter, which is Vail Resort's slowest period by far because most of its properties offer no ski options. Wall Street had been looking for higher numbers, both on the top and bottom lines.

Now what

Vail Resort's management team wasn't concerned with the slow summer period, and in early December, they affirmed their full-year outlook on revenue and earnings. However, actual results will depend heavily on weather conditions in the U.S. and Canada during peak ski season.

Looking further out, Vail Resorts is upgrading many of its properties to deliver manufactured snow so it can have more reliable ski offerings and a longer season. The business will take an earnings hit from these capital investments this year, but they should start paying off by boosting season pass sales and hotel stays beginning in the next fiscal year.

Check out the latest Vail Resorts earnings call transcript.