Vail Resorts : The bullish trend is over
Entry price | Target | Stop-loss | Potential |
---|
$47.35 |
$0 |
$49.3 |
+100% |
---|
Vail Resorts is the premier mountain resort company in the world and a leader in luxury, destination-based travel at iconic locations. The Company operates in three separate, but highly integrated segments. Firstly, the mountain segment includes lift ticket, ski & snowboard school, dining and retail & rental businesses. Secondly, Vail Resorts Hospitality owns and/or manages a portfolio of luxury hotels under the RockResorts brand, a number of hotels and condominiums located in proximity to the ski resorts. Thirdly, the real estate segment, Vail Resorts Development Company, holds, develops, buys and sells real estate in and around the resort communities.
Fundamentally, the company is overvalued. It is currently trading 124 times its EPS. Sales are not expected to increase over the coming years. Net margin is very low. There is a lot of debt : net debt represents 2.11 times EBITDA. EPS revisions for 2012 and 2013 are decreasing since last October.
Technically, the stock is currently testing again its USD 48.1 resistance. It is a reversal situation because of the resistance and the slant mark. In weekly data, it is the same case. The security is in the upper part of its trading range between USD 40.8 and USD 47.5. After a huge increasing thanks to its Q3 results, the stock might suffer from a heavy correction.
Due to graphical analysis, investors can sell the stock immediately. The target price is USD 44. To avoid important losses, a stop loss will be fixed at USD 48.5.
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