5 Best Entertainment Stocks To Buy In 2023

In this article, we discuss 5 best entertainment stocks to buy in 2023. If you want to see more stocks in this selection, check out 12 Best Entertainment Stocks To Buy In 2023. 

5. Six Flags Entertainment Corporation (NYSE:SIX)

Number of Hedge Fund Holders: 40

Six Flags Entertainment Corporation (NYSE:SIX) owns and operates local amusement and aqua parks under the Six Flags label. These parks provide a variety of rides, aquatic attractions, themed sections, live performances and spectacles, dining establishments, gaming areas, and stores. It is one of the best entertainment stocks to invest in. 

On April 20, Morgan Stanley analyst Thomas Yeh initiated coverage of Six Flags Entertainment Corporation (NYSE:SIX) with an Equal Weight rating and a price target of $29. The analyst believes that the regional theme parks run by Six Flags are profitable enterprises, with per-share growth in double-digit levered free cash flow. He views the group as having an appealing risk-to-reward ratio, given that its valuation is “well below pre-pandemic levels,” even compared to other consumer sectors. Yeh added that the firm’s positive industry outlook is due to its unique brands, high entry barriers, and complementary footprints. However, the firm recognizes both opportunities and risks stemming from Six Flags Entertainment Corporation (NYSE:SIX)’s recent strategic reset, which could lead to potential growth.

According to Insider Monkey’s fourth quarter database, 40 hedge funds were bullish on Six Flags Entertainment Corporation (NYSE:SIX), compared to 35 funds in the prior quarter. Rehan Jaffer’s H Partners Management is the largest stakeholder of the company, with 11.40 million shares worth $265 million. 

Here is what Merion Road Capital specifically said about Six Flags Entertainment Corporation (NYSE:SIX) in its Q3 2022 investor letter:

“I am actively looking for new ideas and started dipping my toe in Six Flags Entertainment Corporation (NYSE:SIX). SIX is another turnaround situation. Unlike PTON, SIX is backed by hard assets and has a history of stable earnings. New management is looking to grow EBITDA to $700mm vs. the $525mm range over the past several years, covid aside. Their strategy is to effectively reduce traffic and increase price, while prioritizing capital spend on high return projects. Results have admittingly been mixed so far. But even assuming no benefit from the new initiatives, the company is trading at a reasonable valuation of 11x EBIT.”