Earnings Preview for Vail Resorts

Vail Resorts MTN is set to report third-quarter fiscal 2011 results Thursday, June 9, after the markets close. In the past four quarters the stock saw a bump of about 3% following earnings; will the streak continue? Analysts are looking for the resorts operator to report that earnings grew 7.5% from a year ago to $2.14 per share. Sixty days ago, that consensus earnings estimate was the same. The revenue forecast for the quarter calls for $412.6 million, an increase of 17.8% from the same period of last year. The Company Colorado-based Vail Resorts operates resorts principally in the United States. The company operates in three segments: The Mountain segment operates five ski resort properties. The Lodging segment owns and/or manages a collection of luxury hotels. The Real Estate segment owns and develops real estate properties. In the three months that ended in April, the company announced a development in the Bahamas, made a cash tender offer and lowered season pass rates for a limited time. Looking Ahead Analysts so far expect to see another net loss in the fourth quarter. But for the full year, earnings are expected to be up 23.8% to $1.09 per share and revenues up 29.7% to $1.1 billion. Note that earnings results were better than expected in just two of in the past four quarters; losses in the first quarter and fourth quarter of 2010 were wider than analysts predicted. Performance The long-term earnings per share growth forecast is 16.3%. Though the P/E ratio is 39.7 and the PEG ratio is 2.6, analysts on average recommend buying MTN and have for more than 90 days. Their mean price target (a sign of where they expect the share price to go) is currently $59.63. However, the share price has slipped about 12% in the last three months, recently falling below the 200-day moving average. Shares opened today at $43.50. Over the past year, the stock has underperformed the resorts and casinos industry average, as well as competitor Starwood Hotels & Resorts HOT.