Six Flags Activist Wants a Real Estate Deal
A new year comes in the wake of a major winter storm, but there’s already an activist situation simmering around a company built on summer fun.
Investment firm Land & Buildings unveiled a 3% stake in Six Flags Entertainment SIX +0.74% (ticker: SIX) in late December, and is pushing the theme-park operator to sell and lease back its real estate portfolio. Land & Buildings is the second activist to target Six Flags; H Partners Management won a seat on the board in January 2020 and agreed in November 2022 to lift its Six Flags stake to 19.9%.
It’s no wonder that Six Flags once again garnered interest from an activist investor. The stock lost nearly half of its market value in 2022, and the company is in the midst of a challenging turnaround. It’s now raising prices so that the parks will no longer be used as what CEO Selim Bassoul once referred to as “cheap daycare centers.”
“We concur with some points...but may differ on the critical priorities for generating potential upside,” wrote Jefferies analyst David Katz in a recent note. More attention, he added, “should push the shares higher.” Katz rates Six Flags stock a Hold with a $24 price target.
Land & Buildings argued in a December presentation that separating Six Flags’ real estate from the operating company could add $11 to the share price.
Six Flags acknowledged Land & Buildings’ presentation in a statement, and said it has had conversations with the firm. Six Flags added that it’s “encouraged” by the progress made by its strategic plan that’s already in place.