PKS is an interesting bet, I'd say. On the one hand, since I'm a fan of stocks at their lows, PKS has never traded lower than today. It's getting downgraded, but at some point, I'd guess park attendance will be up, and analysts will again upgrade the stock, whether on attendance, favorable demographics, new attractions, land values, vacation get-aways, etc. I'd say the stock is a good bet to recover. The company's got great brand awareness, and they seem to be very good at marketing.
But there are some very disturbing things too. If the company's so strong and well-positioned as I suspect, how come they haven't shown a profit since 1998? The stock got hit today because the company failed to meet expectations. I don't understand why expectations would be so high (to crater the stock 50%) when this company has so long not delivered to the bottom line. And book value just keeps decreasing. Long term debt is at twice book value.
For me, PKS is one of those stocks that I can make a gentleman's bet will recover - a double or more within a couple of years. But I won't put my own money into the stock because to me the stock, without earnings, has been overvalued for years. It's just my guess that people will once again come to value PKS at those prices which seem so inexplicable (and so high) to me.
Paul S. |
