Oppenheimer maintains Outperform rating on Viad Corp stock, citing strong trends Via Investing.com
Oppenheimer reaffirmed its Outperform rating and $41.00 price target. Viad Corp (NYSE: NYSE:), a dominant player in the business and leisure services industry.
The company's decision follows a recent discussion with the company regarding investor questions and feedback.
Viad Corp highlighted the current recovery progress in Jasper after the wildfires and reported strong trends in its Pursuit segment, which is a positive indicator of the company's performance.
Viad Corp's General Services (GES) division is expected to bring in revenue in 2025 on par with its 2024 figures, despite the challenge of negative trade volatility. The company is committed to maintaining its margin profile into 2025 and beyond. This focus on profitability is a key element of Viad's strategy as it navigates an evolving market environment.
Analysts at Oppenheimer pointed out that Viad shares trade at an attractive valuation of just 7.5 times the company's estimated 2025 EBITDA. Valuations are considered low relative to peers in the business services and lodging/leisure sectors, which typically trade in the high single-digit to low-teens range. The difference can present a great opportunity for investors.
The reiteration of an Outperform rating and $41 price target by Oppenheimer reflects confidence in Viad's ability to sustain and grow, especially considering the recent drop in share prices.
In other recent news, Viad Corp reported earnings for the second quarter of 2024 that beat expectations, despite facing significant challenges due to the Jasper National Park wildfires.
The company's Global Experience Specialists (GES) and Pursuit divisions both showed strong performance, contributing to strong earnings. GES's revenue growth and margin improvement led to adjusted guidance exceeding EBITDA, while Pursuit's adjusted EBITDA was near the upper end of guidance, bolstered by strong demand for attractions and lodging.
In addition to the earnings report, Viad Corp announced the appointment of Jill Bright to the Board of Directors. Bright, who will serve as a Preferred Director, is scheduled to remain in this role until the 2025 annual meeting of shareholders.
The appointment was made pursuant to the terms of the Stockholders Agreement with Crestview Partners IV GP, LP and its affiliates, which hold 5.5% of the company's Series A Convertible Preferred Stock.
Looking to the future, Pursuit revised its full-year adjusted EBITDA guidance in light of wildfire-related uncertainty. The company remains optimistic about the recovery and reopening of attractions, maintaining a positive outlook throughout the year. Viad Corp is focused on expanding the Pursuit through organic and inorganic investments, with $20 million allocated to build and renovate projects by 2024.
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