I hold short so I have a negative view but I don't ramp down or up on any stock I express my view, people, free to comment but I usually don't engage in personal attack.
I don't think the short term is looking good and there is no catalyst for it to turn.
That accident at dreamworld really hurt them, people are now afraid to go to dream world for the fact it wakes them up a lot of these rides are old and ageing and they don't know what state they are in so they are staying away. I wouldn't take my kids there period, It may be a lot safer now but that little nagging fear will keep me well away.
The main event in the US, US is a large market but also highly competitive, it is not walk in a park just open up entertainment centre, you doing it wrong it going to cost you big time.
I have a little more insight into this area via knowledge of monopoly business and they doing it tough, I collect lego and buying them for my kids, lego is a virtual monopoly in this area of toy, there is no comparison, they have a virtual stranglehold in this market but when they operate in the US they have
to sell their products cheaper than anywhere else on the planet, lot of people question them why?
and their answer is: US is a highly competitive market, even though we are a monopoly we have to fight for their entertainment dollar so we have to work harder than competitive and sell as cheap as we can in order to get their entertainment dollar.
I import legos from US pay for shipping and still cheaper than buying them in Australia
Now if a monopoly business facing that pressure what other problems would other business has?
Also, their headline margin of 30% in the main event is misleading when you deduct all other costs their margin is tiny, the centre takes a while to recruit money, at a moment they are burning cash to open new centre because the other centres dont generate enough cash flow.
at this rate there are stuffed, cash will run out sooner or later and they still has debt on their book.
Weiss and Co are activist shareholders, they don't have the skill to run this business they are in properties development and this is an entertainment business, I reckon they misjudge it thinking it an easy turn it won't be.
