Oppenheimer maintains Outperform rating on Viad Corp stock, cites strong trends By Investing.com

Oppenheimer has reaffirmed its Outperform rating and $41.00 price target on Viad Corp (NYSE: NYSE:), a notable player in the business services and leisure industry.

The firm’s decision follows a recent discussion with the company regarding investor inquiries and feedback.

Viad Corp highlighted the current recovery progress in Jasper after a wildfire 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 also expected to generate revenue in 2025 on par with its 2024 figures, despite the challenge of negative show rotation. The company is committed to maintaining its margin profile going into 2025 and beyond. This focus on profitability is a key aspect of Viad’s strategy as it navigates the evolving market landscape.

Analysts at Oppenheimer pointed out that Viad’s shares are trading at an attractive valuation of only 7.5 times the firm’s 2025 EBITDA estimate. The valuation is considered low when compared to peers in the business services and lodging/leisure sectors, which typically trade in the high single-digits to low teens range. The discrepancy may present a favorable opportunity for investors.

The reiteration of the Outperform rating and the $41 price target by Oppenheimer reflects confidence in Viad’s ability to recover and grow, especially considering the recent dip in share prices.

In other recent news, Viad Corp reported second-quarter 2024 earnings that exceeded expectations, despite facing significant challenges due to wildfires in Jasper National Park.

The company’s Global Experience Specialists (GES) and Pursuit divisions both showed robust performance, contributing to the strong earnings. GES’s revenue growth and margin improvement led to adjusted EBITDA surpassing guidance, while Pursuit’s adjusted EBITDA was near the top end of guidance, bolstered by high demand for their attractions and lodges.

In addition to the earnings report, Viad Corp announced the appointment of Jill Bright to its Board of Directors. Bright, who will serve as a Preferred Director, is scheduled to remain in this role until the 2025 annual meeting of stockholders.

The appointment was made in accordance with the terms of the Stockholders Agreement with Crestview Partners IV GP, L.P. and affiliated entities, who hold the company’s 5.5% Series A Convertible Preferred Stock.

Looking towards the future, Pursuit revised its full-year guidance for adjusted EBITDA due to wildfire-related uncertainty. The company remains optimistic about the recovery and reopening of attractions, maintaining a positive outlook for the rest of the year. Viad Corp is focused on scaling Pursuit through organic and inorganic investments, with $20 million allocated for build and refresh projects in 2024.

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