Six Flags Entertainment Corp (SIX), Cedar Fair, L.P. (FUN), SeaWorld Entertainment Inc (SEAS): Should You Take a Ride With These Theme Parks?

Like Cedar Fair, L.P. (NYSE:FUN), Six Flags Entertainment Corp (NYSE:SIX) has also reported three straight years of growth, with increases in revenues and adjusted operating income of 5.6% and 9.2%, respectively, in its latest fiscal year.Six Flags Entertainment Corp (NYSE:SIX) doesn’t have the hotel portfolio that provided a boost to Cedar Fair’s top line, but it enjoyed a stronger gain in overall park attendance, up 5% during the period. The company is also focused on increasing its sales of season passes, which provides a more predictable revenue and cash flow stream to invest in new attractions.

Forget the coasters, get back to nature

In contrast, SeaWorld Entertainment Inc (NYSE:SEAS) has roller coasters for thrill seekers, but it tries to sell customers on nature with its marine-themed parks that have 67,000 marine and terrestrial animals, one of the largest collections in the world. Obviously, nature is popular too, as the company’s properties admitted roughly 24 million customers in 2012, in line with overall attendance at Six Flags Entertainment Corp (NYSE:SIX) and Cedar Fair, L.P. (NYSE:FUN). Like its competitors, SeaWorld Entertainment Inc (NYSE:SEAS) has gained from higher attendance levels and its customers’ willingness to spend more during their time in the parks. However, SeaWorld Entertainment Inc (NYSE:SEAS) suffers from fairly weak operating and cash flow metrics, due to the high expenses of maintaining their animal-focused parks, making this recent IPO a work in process.

The bottom line

With economic growth and consumers’ disposable income on the rise, the theme park operators should continue to gain from customers that are looking for diversity in their entertainment options. While the parks spend roughly 9% of their revenues on annual capital investments, they have shown an ability to eventually recover their costs through price increases. Investors should take a wait-and-see approach on SeaWorld Entertainment Inc (NYSE:SEAS), but they should find the solid dividends and long operating histories at Cedar Fair, L.P. (NYSE:FUN) and Six Flags Entertainment Corp (NYSE:SIX) to be much to their liking.

The article Should You Take a Ride With These Theme Parks? originally appeared on Fool.com and is written by Robert Hanley.

Robert Hanley has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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