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Vail Shares Rise As Bank Of America Sees Favorable Outcome In Lease Acquisition

John Seward

Vail Resorts (NYSE: MTN) gained more than two percent to a new six-month high Tuesday after an analyst said it's likely to outperform during the third quarter.

Bank of America's Shaun Kelley also pointed out that Vail may be poised for significant growth if it prevails in acquiring the lease for Park City Mountain Resort in Utah.

The Park City landowner, Talisker Land Holdings, has agreed to give the lease to Vail, but a judge on June 19 delayed the eviction of the existing tenant. A trial is set for August 27 while the judge in the case has ordered the two sides to mediate.

Kelly said acquiring the lease would add $8 per share to Vail's value, in part by linking Park City with Vail's adjacent Canyons resort. Vail signed a $25 million lease with Talisker in 2013 on the Canyons ski property.

Kelley maintains a buy rating on Vail and a $92 target. He also cites ongoing positive trends in advance ticket sales and the potential for greater summer use of Vail's properties.

"Summer and fall are historically the best periods for Vail's shares," said Kelley.

Vail traded recently at $78.37, up 1.5 percent. Its 52-week high is $79.20.

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