The leisure industry is likely to have benefited from robust demand for recreational products and golf business. Higher disposable incomes have boosted consumer spending on leisure activities. The inclination toward business modifications, AI-driven technological enhancements and infrastructure Investments has been a tailwind for most companies.
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Q4 Leisure Industry: A Snapshot
Of late, the golf industry has been gaining from healthy participation and resilient consumer demand. The industry continues to thrive as demand for premium golf gear rises, driven by players seeking to enhance performance and maintain a competitive edge. Per the Report, U.S. consumers are expected to contribute $7.78 (on a per capita basis) to the golf equipment market in 2025.
Companies are focusing on enhancing consumer experiences and introducing new attractions to drive long-term traffic growth. Firms are leveraging new consumer data platforms to provide more targeted promotions and offers to improve customer engagement. Additionally, they are rolling out new passes and bundled packages to encourage repeat visits. The strategic initiative paves the way for a competitive advantage and welcomes more individuals into the golfing community. However, the slower-than-expected Korean market, volatile freight rates and softness in the footwear and apparel markets are likely to have influenced the growth pace in the to-be-reported quarter.
The boat industry is focused on maintaining stability and fostering growth through right-sizing channel inventories, innovative product development, and strong dealer relationships. Companies aim to optimize the supply chain and enhance the consumer experience by aligning production with seasonal demand trends and leveraging advanced financing options. Investments in differentiated product lines, expanded distribution networks, and technological advancements are expected to have strengthened the respective company's market positioning in the fourth quarter.
However, broader economic uncertainty is likely to have acted as a roadblock for the boat industry. While demand remains steady in premium segments, price-sensitive categories such as pontoons are expected to experience cautious retail activity. According to NMMA, new powerboat retail sales are expected to experience a decline in 2024, estimated to range from 9% to 12%, totaling approximately 230,000-240,000 units. Among key market segments, personal watercraft and pontoon boats both experienced declines of 10-13%, with estimated sales of 70,000-75,000 and 52,000-55,000 units, respectively.
The cruise industry is gaining momentum, buoyed by record-high consumer demand and favorable macroeconomic trends. Firms are refining their yield management strategies to optimize booking curves, increase ticket prices and boost onboard spending. Strength in direct-to-consumer channels, AI-driven personalization and travel partners are likely to have contributed positively, generating higher bookings at elevated rates and reinforcing the companies’ commercial positioning. However, higher advertising expenses and fuel rate headwinds are likely to act as a roadblock.
The theme park industry is likely to have benefited from strong attendance trends and improved guest spending on food and beverage. In a demand-driven business, strong attendance serves as a key driver of performance, fueling longer guest stays, enhanced pricing power, increased spending, improved margins and higher free cash flow. Additionally, strategic investments in marketable new attractions and expansion of in-park offerings with infrastructure improvements are anticipated to contribute positively. The industry foresees further growth potential as companies remain vigilant in exploring additional business development opportunities and aligning with evolving customer preferences. Initiatives such as a dynamic pricing model, investment in themed events and technological upgrades (including mobile ordering and virtual queues) indicate a positive trajectory for the industry.
Based on our research and market insights, we present three stocks — AMC Entertainment Holdings, Inc. AMC, Six Flags Entertainment Corporation FUN and Planet Fitness, Inc. PLNT — that are set to beat earnings estimates this earnings season.
How to Make the Right Pick?
Given the wide range of companies in this space, the task is by no means easy. While it is impossible to be sure of the outperformers, our proprietary methodology — a positive Earnings ESP along with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP is our proprietary methodology for identifying stocks that have a high chance of surprising in their upcoming earnings announcement. It shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
Our Choices
Here are a few leisure companies that investors can take a look at.
Six Flags is scheduled to report fourth-quarter 2024 results on Feb. 27. The company has an Earnings ESP of +9.46% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Six Flags Entertainment Corporation Price and EPS Surprise
Six Flags Entertainment Corporation Price and EPS Surprise
Six Flags Entertainment Corporation price-eps-surprise | Six Flags Entertainment Corporation Quote
Six Flags’ fourth-quarter performance is likely to have benefited from solid demand across parks, improved guest spending on food and beverage and merger collaborations With Cedar Fair. FUN is executing a disciplined capital allocation strategy, balancing investments in marketable new attractions and expanded in-park offerings with essential infrastructure improvements. The initiatives pave the way for improving operational efficiency, as well as broadening and enhancing the guest experience. With a strong season pass base and robust October performance — historically accounting for approximately 60% of fourth-quarter attendance — the company remains on track to achieve adjusted EBITDA of $205-$215 million for the quarter.
The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at 35 cents per share, suggesting growth of 118.8% from 16 cents reported in the prior-year quarter.
AMC Entertainment is scheduled to report fourth-quarter 2024 results tentatively on Feb. 25, 2025. The company has an Earnings ESP of +2.04% and a Zacks Rank #3.
AMC Entertainment Holdings, Inc. Price and EPS Surprise
AMC Entertainment Holdings, Inc. Price and EPS Surprise
AMC Entertainment Holdings, Inc. price-eps-surprise | AMC Entertainment Holdings, Inc. Quote
AMC Entertainment’s fourth-quarter performance is likely to have benefited from a recovering box office, revenue diversification initiatives and innovative content. This and the positive reception of food and beverage offerings, including collectible movie-themed items, movie-themed cocktails and menu upgrades, marketing efforts and immersive premium large format auditoriums, are likely to have aided the company’s performance in the to-be-reported quarter. The expansion of the distribution footprint for Ready-to-Eat and Microwave lines of popcorn, theatre upgrades and enhancements to Stubs and A-List loyalty programs are likely to have supported AMC’s fourth-quarter bottom line.
The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at a loss of 16 cents per share, suggesting growth of 70.4% from a loss of 54 cents reported in the prior-year quarter.
Planet Fitness is scheduled to report fourth-quarter 2024 results on Feb. 25. The company has an Earnings ESP of +0.90% and a Zacks Rank #3.
Planet Fitness, Inc. Price and EPS Surprise
Planet Fitness, Inc. Price and EPS Surprise
Planet Fitness, Inc. price-eps-surprise | Planet Fitness, Inc. Quote
Planet Fitness’ fourth-quarter performance is likely to have benefited from a new growth model, pricing strategies and strong membership growth. This and the focus on improving the member experience, refining the product offering and increasing the pace of club openings are likely to have aided the company’s performance in the to-be-reported quarter. Recently, it revealed key operational metrics for 2024-end meeting growth objectives set at the start of the year. As of Dec. 31, 2024, PLNT increased its membership base to approximately 19.7 million, with system-wide same-club sales growing 5% year over year. It opened 150 new clubs, including 21 corporate-owned locations, bringing the total number of clubs to 2,722.
The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at 62 cents per share, suggesting growth of 3.3% from 60 cents reported in the prior-year quarter.
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