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Vail Resorts, Inc. (NYSE: MTN) is well-positioned to benefit from “high-end pent-up leisure demand” in the forthcoming ski season, according to BofA Securities.
The Vail Resorts Analyst: Shaun Kelley upgraded the rating for Vail Resorts from Neutral to Buy, while maintaining the price target at $350.
The Vail Resorts Thesis: The company has lowered prices for its Epic Pass products by an aggressive 20%, which seems to be “a calculated move to increase customer loyalty and retention, long-term customer engagement and overall skiing accessibility,” Kelley said in the upgrade note.
“Vail seems to be accelerating toward a recurring revenue model with a goal of reaching 75% of lift ticket revenues up from 47% in 2019,” the analyst wrote. Management may be basing pricing decisions on lifetime value insights gained from Epic Day Pass and COVID pass credits, he added.
“We think Vail is a consumer industry pioneer as it relates to data analytics and marketing and this is the next step in its evolution to drive a step-function change in season pass usage and adoption that can ultimately be rewarded with higher earnings, valuation or both,” Kelley commented.
MTN Price Action: Shares of Vail Resorts had fallen by 0.13% to $278 at the time of publication Thursday.
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