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Six Flags Corporate Discussion Thread


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  • 2 weeks later...

Six Flags Black Friday sale is pretty good. If like me you still had the old Gold membership, upgrade to Platinum during this sale. For me, it's $6.20/mo. per membership for 5 memberships to Six Flags St. Louis, less than I was paying for Gold.

 

https://www.sixflags.com/stlouis/store/cyber-sale

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  • 4 weeks later...

Six Flags is now effectively offering rain checks for people that buy tickets for a specific day. If guest relations considers the weather to be "bad" or "unpleasant", you can change your selected day to another one before your visit. I don't believe that this applies once you use your ticket to enter the park, though.

 

465335695_ScreenShot2018-12-15at10_44_43AM.png.01584aa1bb77aaa9c35a6def0047c286.png

https://www.sixflags.com/weather

 

Six Flags Weather Guarantee

The Six Flags Weather Guarantee (for "Choose Your Day Tickets") basically says that: if you are unable to visit the park on the date you selected when you purchased your tickets because of poor weather, you may use your tickets to visit any other public operating day (at the park you bought tickets for) on or before December 31, 2018.

 

What constitutes a "Bad Weather Day" ?

Certainly any days it rains or snows at the park is a bad weather day. But so are days when it is extremely cold. Different guests are going to have different tolerances for different types of weather, so we plan to be flexible.

 

How does the guarantee work?

Buy your tickets from our website using the calendar day pricing/ticket option (if you buy an any day ticket this policy doesn't apply to you, because you can visit any day you choose). In the event that you later decide that you cannot visit due to inclement weather, simply visit on a different day when the weather is better no later than December 31, 2018. Stop by the Guest Relations office and they will make sure that you are able to enter the park. It's that easy!

 

When must I visit by?

If you can't visit on your regularly planned date because of poor weather, you may use your tickets to visit any public operating day (at the park you purchased your tickets from) on or before December 31, 2018.

 

What happens to my tickets if I can't visit by December 31?

You must use your ticket to visit by December 31, or your tickets will permanently expire (just like they ordinarily would).

 

Who does this weather guarantee apply to?

It applies only to purchasers of admission tickets with pre-selected dates (usually referred to as "Choose Your Day Tickets"). It does not apply to Good Any Day Tickets, Season Passes, Group Tickets, or Memberships. That is because people with these types of tickets don't need a special guarantee to visit any day they choose.

 

I think it is too cold to visit the park, but it isn't raining or snowing. Does the guarantee apply to me?

Our team at Guest Relations has broad authority to allow you to use your tickets on any day that could reasonably characterized as "unpleasant." While it is unlikely that we would characterize a sunny, clear day that's 70 degrees as "unpleasant," we are open to consider any reasonable request. In all instances Guest Relations is the final judge of what constitutes a "unpleasant weather day."

Edited by jedimaster1227
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I like the thought. but they need to be more sincere. Those targeting a specific date are likely to be visitors making long trips and on an itinerary. They should allow you the use the rain check up to 18 months after the "rain date". It still won't satisfy everybody but gives long distance travelers a better opportunity to return.

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Tickets like this are like Gift Cards in the eyes of Six Flags:

 

They are hoping that people buy them, then forget to use them. The new weather policy aids in that. They hope that you tell yourself that you'll reuse your ticket for a rainy day in June sometime in August, but we all know how our lives can conspire against plans like that...

 

It's a simple step that keeps money coming in and allows a simple mitigation step in dealing with customer complaints/anxieties.

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Tickets like this are like Gift Cards in the eyes of Six Flags:

 

They are hoping that people buy them, then forget to use them. The new weather policy aids in that. They hope that you tell yourself that you'll reuse your ticket for a rainy day in June sometime in August, but we all know how our lives can conspire against plans like that...

 

It's a simple step that keeps money coming in and allows a simple mitigation step in dealing with customer complaints/anxieties.

 

I don't know...

Wouldn't they rather have that person in the park spending money? They already your admission money, everything beyond that is a plus.

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Tickets like this are like Gift Cards in the eyes of Six Flags:

 

They are hoping that people buy them, then forget to use them. The new weather policy aids in that. They hope that you tell yourself that you'll reuse your ticket for a rainy day in June sometime in August, but we all know how our lives can conspire against plans like that...

 

It's a simple step that keeps money coming in and allows a simple mitigation step in dealing with customer complaints/anxieties.

 

Gift cards are not as simple as "I took your money up front, I hope I never have to give it back."

 

While they receive the cash flow up front, it stays on the books as a liability until it's actually redeemed. Eventually a store has to give the value of the gift card back in product.

 

This is good for two things:

1. It's good publicity and a nice goodwill gesture that really costs the park nothing.

2. Parks make their real money inside. Food, drink, games, parking, souvenirs, premium skip the line products, etc. Walking away with just someone's $50 (or whatever six flags charges) is probably a net loss, because I would guess someone buying just a 1 day ticket is way more likely to spend additional money in the park than a passholder would...

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  • 2 weeks later...
Tickets like this are like Gift Cards in the eyes of Six Flags:

 

They are hoping that people buy them, then forget to use them. The new weather policy aids in that. They hope that you tell yourself that you'll reuse your ticket for a rainy day in June sometime in August, but we all know how our lives can conspire against plans like that...

 

It's a simple step that keeps money coming in and allows a simple mitigation step in dealing with customer complaints/anxieties.

 

I don't know...

Wouldn't they rather have that person in the park spending money? They already your admission money, everything beyond that is a plus.

 

I think it depends on the crowds that your park expects. In general, and for a certain days of the year. You're kind of talking about the mentality of a nightclub. It only really works if its popular and gets a steady flow of traffic. If its dead, its a problem. Parks that are smaller, new, or struggling would practically give the tickets away if they could, because its a little embarrassing for people to see your park constantly dead, and as you were saying they want you in the park so that they can up-charge you for the food, parking, merch, up-charge rides, etc.

 

But as parks become more established and popular, its better to keep your prices more true to actual usage. The park can only fit so many people, and the GP hate lines as much as enthusiasts. If the park gets too jammed packed, they'll be turned off and not want to come back. Or, even worse, the rich people with money won't come back, but the lower income people who never spend will keep coming back. And, believe it or not, when parks get jammed packed, the lines for concessions get out of control, and you aren't really making any more money off of them that you would with fewer people.

 

So its a balancing act. Generally, its best to balance your profit centers as much as possible and not just assume that you'll make it all off of food, merch, and parking. And, you have to remember that you're in the business of rides, and if your park is jam packed, that may mean that you're doing great and people love your product, or it may mean that they've just been too aggressive about lowering your price or giving away visits for free (with the passes and memberships).

 

 

Another point I wanted to make:

 

I think that getting people to buy tickets up front is less about the instant gratification/time value (only a month or two, so the time value rate is minimal) but more about being able to plan the year out and being able to expect where and when your crowds will be. This will allow you to be more lean with staffing levels and will help you plan your ride maintenance more appropriately.

^^^^The caveat to this is that this is Six Flags... not Disney or Cedar Fair. This is what Disney and Cedar Fair does. SF is not a well run company so they don't always make the smartest choices and plan ahead.

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SF is not a well run company so they don't always make the smartest choices and plan ahead.

I could argue against that, but you know what, I'll just let this headline do it for me.

 

Dividend Increases for Eighth Consecutive Year at Six Flags

 

https://investors.sixflags.com/news-and-events/press-releases/2018/11-14-2018-210455656

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From a financial standpoint, Six Flags is a very well run company. They manage their labor and operational costs very well.

 

What that means for the guest experience? Well...I think most people know what they are getting when they are forking over the $7-20/month for their membership.

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Six Flags does very well with the perception of value. I couldn't even count how many people were walking around with Diamond / Diamond Elite member lanyards when I visited Six Flags Over Georgia. Those people think that they're the top of the world because Six Flags has done a fantastic job in upselling that higher-level membership, and also because of the little things like showing your badge to a team member and being thanked for it.

 

The concept of "owning" a season pass isn't exclusive to Six Flags (just look at Universal's recent passholder advertisements), but they do a really good job of making guests feel special for the least amount of money, even though we here likely have a different expectation of what "special" treatment really can be.

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SF is not a well run company so they don't always make the smartest choices and plan ahead.

I could argue against that, but you know what, I'll just let this headline do it for me.

 

let's go, let's have a laugh with your theories

I didn't state any theories. I gave a link to an actual earnings report that is federally mandated to be accurate and subject to FTC fines if it's not. That report says they're making money. So either they're lying to investors and incurring huge financial penalties for doing so, or they're actually making money. Probability is they're actually making money, which means their business model works. You don't improve a dividend for eight straight years with a business model that doesn't work.

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Six Flags' business model is bordering on revolutionary for regional parks. Value of the company makes them bigger than SEAS, Cedar Fair, etc. And honestly? They're operating as well or better than any other time I can recall in memory. Yeah, there's some Disney nerds out there put off by the wraps on coaster trains, but those people are also the least adventurous souls on the face of earth.

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SF is not a well run company so they don't always make the smartest choices and plan ahead.

I could argue against that, but you know what, I'll just let this headline do it for me.

 

Dividend Increases for Eighth Consecutive Year at Six Flags

 

https://investors.sixflags.com/news-and-events/press-releases/2018/11-14-2018-210455656

 

Yeah, nothing like posting a link from the official website to show authority from a source. Their stock was in the gutter for so long that increasing dividends and the rising price of the stock doesn't mean much. It just means that the people who bought it on a firesale before are seeing it coming back to Earth now. But I can also agree that its just the Wal Mart/Spirit Airlines/Megabus/McDonald's of amusement parks... at best. Their model is to cut costs and give families a serviceable experience with no bells and whistles.

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SF is not a well run company so they don't always make the smartest choices and plan ahead.

 

Others are saying SF is well run and have provided measurable metrics (stock growth, dividend increases) to support why there think the park is well run.

 

You have yet to provide any evidence or facts to back up your view, you only point out what you don't like.

 

Yeah, nothing like posting a link from the official website to show authority from a source. Their stock was in the gutter for so long that increasing dividends and the rising price of the stock doesn't mean much. It just means that the people who bought it on a firesale before are seeing it coming back to Earth now. But I can also agree that its just the Wal Mart/Spirit Airlines/Megabus/McDonald's of amusement parks... at best. Their model is to cut costs and give families a serviceable experience with no bells and whistles.

 

Six Flags horrible past has no bearing on the current situation. The company dissolved and went went complete restructuring after Dan Snyder. When it was repriced and brought with the new IPO, it was not a firesale and investors were still taking a risk. Dividends can only be given out and increased if the company performs. Granted if you start with a very low dividend it is easy to deliver quarter over quarter increases in the short term. Are you also implying that McDonalds and WalMart is not well run.

 

The choice of a company to focus on low cost sales over service does not mean a company is not well run. A company that takes that approach and doesn't make money is not well run.

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Also a fun fact, the new IPO appears to have been launched for $9.75. Unless Six Flags is secretly the next Enron, a 5x increase in stock price in a span of 8 years is a sign the company is being well run from a financial standpoint. Heck, buying it now would be considered a "firesale" considering the stock touched $72 when the market was at it's highest point in September.

 

Separating your bias against their operation from their financial performance is important here...

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^ It is actually nearly double that as the stock did a two for one split a few years ago when it reached the 70s. So you are looking at 10x since emerging.

 

Too Fast for Comfort,

 

Some other bullets I would add:

- Creating additional income streams with small to no investments. Their business model for park licensing deals is fantastic and is providing the company with large amounts of additional revenue. Those numbers will grow greatly once the parks open.

- 2017 was the best year in the company's history for attendance and revenue, while growing EBITDA

- Growing Q1 and Q4, which jsut a few years ago were very soft times for the company, now are among the strongest

- Guest survey numbers are at all time high for a number of the parks

- Go read up on Project 600 and 750. Would love to hear your counter point on how that is bad business.

 

All of the above was taken from the earning calls and reports over the last year. I would recommend you listen to some of those and hear the reaction from analysts yourself, especially when you hear those same analysts on other calls. Take the Q2 earnings call -the same analysts within a few days praised Six Flags performance while greatly questioning Cedar Fair and their soft quarters. One of the analyst who was on both calls even said "your competitor isn't using weather as an excuse why are you", "why are you now creating additional revenue streams like Six Flags?" "Do you plan on growing your parks like Six Flags".

 

Really curious on your thoughts after reading up on Project 600 and 750.

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Is it generally a good idea to own stocks for companies whose products/services are based solely in the elastic area of the demand curve at 10+ years into an economic expansion? Most experts state that we are overdue for some type of recession or depression and these stocks always have their best percent-off sales at that time. Does anyone have an argument otherwise?

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Is it generally a good idea to own stocks for companies whose products/services are based solely in the elastic area of the demand curve at 10+ years into an economic expansion?

 

Depends on when you buy and sell said stock. At this point, I think valuation of the stock is probably alright - maybe a little low, but the big gains are long in the past.

 

Most experts state that we are overdue for some type of recession or depression and these stocks always have their best percent-off sales at that time. Does anyone have an argument otherwise?

 

What experts? Most people I know have no such belief in such inherent cycles except Austrian school weirdos. There's an argument that deficit spending during positive economic growth is inherently stupid, but that won't in and of itself cause a recession (though intentionally blowing up the market and causing the prices of goods/services to rise would definitely do so).

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And to add that is a blanket statement to apply to the market in general and even among entertainment stocks. Recession or not, a big part of it depends on the company's business model. Generally speaking regional entertainment does OK in recession periods because people are cutting back on big vacations and look for things closer to home. In SIX's case their plan to create licensing and leasing deals should set them up nicely regardless of any small dips in the economy. If/when they get the China parks online that will be a huge revenue stream for them that can help balance out softness here. They shared that the 5-7 year goal for the first China complex is upwards of 7 million guests a year. That's big revenue numbers from licensing.

 

And overall SIX has done a great job about value perception (according to the CEO in a recent earnings call the value perception rating has never been higher from guest surveys). If things in the economy slip and you look to cut out things, they have positioned the passes at such a great value it might no longer be the first thing a family cuts when for ~125 bucks/person a year they can entertain their kids and have them feed. Compared to a movie or a sporting event, SIX is a great value. They have said as much in calls that the passes are designed to get those incremental visits from guests when they think "what should we do this weekend? oh we have passes, let's go there."

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The only counterpoint I would offer to that is that unless all the licensing and advertising deals are ironclad, there would be risk associated with relying on so much revenue from outside sources outside the core business.

 

That being said, the core business is memberships and selling stuff inside the park, so as long as that is still working they are gravy.

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