Six Flags Entertainment Corporation/NEW (FUN) Stock Analysis
Six Flags Entertainment Corporation/NEW (FUN) Stock Analysis
Overall Grade: F (Concerning)
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Six Flags Entertainment Corporation/NEW faces challenges in financial performance that warrant careful analysis.
Key Metrics:
| Metric | Value | Context |
|---|---|---|
| ROIC | -15.9% | Below expectations |
| FCF Margin | -4.9% | Cash flow pressure |
| Debt/Equity | 9.4x | Elevated debt |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
What is Six Flags Entertainment Corporation/NEW's Profitability and ROIC?
Six Flags Entertainment Corporation/NEW's return on invested capital of -15.9% is below the typical cost of capital. Gross margin of 91.3% with operating margin at -44.4% reflects the company's strong market position.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Return on Invested Capital (ROIC) | -15.9% | Red flag | Below cost of capital |
| Return on Equity (ROE) | -115.9% | Red flag | Moderate equity returns |
| Gross Margin | 91.3% | Excellent | Strong pricing power |
| Operating Margin | -44.4% | Warning | Moderate operational efficiency |
How Strong is Six Flags Entertainment Corporation/NEW's Cash Flow Quality?
Six Flags Entertainment Corporation/NEW generated $-152.2M in free cash flow over the trailing twelve months, representing a -4.9% margin. FCF was positive in N/A of the last 8 quarters, indicating variable cash generation.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Free Cash Flow Margin | -4.9% | Red flag | Thin cash margins |
| Free Cash Flow (TTM) | $-152.2M | Red flag | Cash burn |
| OCF/Net Income | -0.2x | Warning | Potential accrual concerns |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
What is Six Flags Entertainment Corporation/NEW's Financial Health?
Six Flags Entertainment Corporation/NEW's debt-to-equity ratio of 9.4x indicates elevated leverage.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Debt to Equity | 9.4x | Red flag | Elevated leverage |
| Net Cash Position | $-5.1B | Warning | Net debt position |
Is Six Flags Entertainment Corporation/NEW Stock Overvalued or Undervalued?
Six Flags Entertainment Corporation/NEW trades at a P/E of -1.0x, representing a premium to the sector median of N/A. Free cash flow yield of -9.9% reflects market expectations for growth.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| P/E Ratio | -1.0x | Red flag | Reasonable valuation |
| EV/Sales | 2.1x | Good | Attractive revenue multiple |
| FCF Yield | -9.9% | Warning | Lower cash yield |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | -15.9% | Bottom 10% | -1.6x below |
| Free Cash Flow Margin | -4.9% | Bottom 10% | -1.5x below |
| Gross Margin | 91.3% | Top 25% | 2.2x above |
| Operating Margin | -44.4% | Bottom 10% | -8.9x below |
| Return on Equity (ROE) | -115.9% | Bottom 10% | -9.6x below |
Rating Thresholds
Return on Invested Capital (ROIC)
Measures how efficiently a company uses its debt and equity capital to generate profits. ROIC above 15% typically indicates a competitive moat.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Exceptional capital efficiency, strong competitive moat |
| Good | 12% - 20% | Above-average returns, sustainable competitive position |
| Adequate | 8% - 12% | Around cost of capital, moderate competitive position |
| Warning | 4% - 8% | Below cost of capital, value may be eroding |
| Red flag | < 4% | Significant capital destruction, fundamental issues |
Current: -15.9% (Red flag)
Free Cash Flow Margin
The percentage of revenue converted to free cash flow. Higher margins indicate stronger cash generation and business quality.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Strong cash generation, high-quality business |
| Good | 10% - 20% | Healthy cash conversion |
| Adequate | 5% - 10% | Moderate cash generation |
| Warning | 0% - 5% | Thin cash margins, capital intensive |
| Red flag | < 0% | Cash burn, potential liquidity concerns |
Current: -4.9% (Red flag)
Gross Margin
Revenue minus cost of goods sold as a percentage. Higher gross margins indicate pricing power and competitive advantage.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 50% | Strong pricing power and competitive moat |
| Good | 30% - 50% | Healthy margins, differentiated product |
| Adequate | 20% - 30% | Moderate margins, competitive industry |
| Warning | 10% - 20% | Thin margins, commodity-like business |
| Red flag | < 10% | Very thin margins, structural challenges |
Current: 91.3% (Excellent - Top 25% of sector (median: 40.9%))
Debt to Equity Ratio
Total debt divided by shareholders' equity. Lower ratios indicate more conservative financing and reduced financial risk.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 0.3x | Conservative leverage, strong balance sheet |
| Good | 0.3x - 0.7x | Moderate leverage, healthy financial position |
| Adequate | 0.7x - 1.5x | Elevated leverage, monitor closely |
| Warning | 1.5x - 3.0x | High leverage, increased financial risk |
| Red flag | > 3.0x | Excessive leverage, potential distress risk |
Current: 942.4% (Red flag)
Free Cash Flow Yield
Free cash flow per share divided by stock price. Higher FCF yield indicates better cash return relative to valuation.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 8% | High cash return, potential value opportunity |
| Good | 5% - 8% | Solid cash yield |
| Adequate | 3% - 5% | Moderate cash return |
| Warning | 1% - 3% | Low cash yield, growth expectations |
| Red flag | < 1% | Minimal cash return to shareholders |
Current: -9.9% (Red flag)
Frequently Asked Questions
Q: What is Six Flags Entertainment Corporation/NEW's Return on Invested Capital (ROIC)?
Six Flags Entertainment Corporation/NEW (FUN) has a trailing twelve-month Return on Invested Capital (ROIC) of -15.9%. This compares below the sector median of 9.8%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is Six Flags Entertainment Corporation/NEW's Free Cash Flow Margin?
Six Flags Entertainment Corporation/NEW (FUN) has a free cash flow margin of -4.9%, generating $-152.2 million in free cash flow over the trailing twelve months. Negative free cash flow means the company is consuming cash, which may require financing.
Q: Is Six Flags Entertainment Corporation/NEW stock overvalued or undervalued?
Six Flags Entertainment Corporation/NEW (FUN) trades at a P/E ratio of -1.0x, which is above the sector median of N/A. The EV/Sales multiple is 2.1x.
Q: How much debt does Six Flags Entertainment Corporation/NEW have?
Six Flags Entertainment Corporation/NEW (FUN) has a debt-to-equity ratio of 9.4x with total debt of $5.2 billion. Net debt position is $5.1 billion.
Q: What is Six Flags Entertainment Corporation/NEW's revenue and earnings growth?
Six Flags Entertainment Corporation/NEW (FUN) grew revenue by 14.4% year-over-year. Net income declined by 591.8% year-over-year. Solid growth above 10% suggests healthy business momentum.
Q: How does Six Flags Entertainment Corporation/NEW compare to competitors in Consumer Discretionary?
Compared to other companies in Consumer Discretionary, Six Flags Entertainment Corporation/NEW (FUN) shows: ROIC of -15.9% is below the sector median of 9.8% (-1.6x median). FCF margin of -4.9% trails the sector median of 3.2%. Gross margin at 91.3% is 50.4 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Consumer Discretionary companies with available SEC filings.
Q: What warning signs should I watch for with Six Flags Entertainment Corporation/NEW?
Investors in Six Flags Entertainment Corporation/NEW (FUN) should monitor these potential warning signs: 1) FCF margin is thin at -4.9%, leaving limited buffer for economic downturns. 2) ROIC has been declining, potentially signaling deteriorating competitive position. 3) Debt-to-equity of 9.4x is elevated. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-11-07. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
This analysis is for informational purposes only and does not constitute investment advice.