Following the complete disaster that was 2017, for much of 2018 Merlin Entertainments shares were in recovery mode, climbing from £3.63 to a 9 month peak of £4.17 in mid-July.
However, things quickly unravelled in the second half of the year, with a very poorly received Q3 update in October speeding up its decline.
Eventually closing out December at £3.20, the stock has rebounded since the start of 2019, with Merlin Entertainments shares now at a current trading price of £3.64.
Merlin sort of caught a tough break with the reception to its third quarter statement. Organic group revenue for the year to date had risen 4.7%, with a 9% increase at Resort Theme Parks and a 6.4% jump at Legoland Parks, alongside the launch of 2 new brands with Peppa Pig World of Play in Shanghai and The Bear Grylls Adventure in Birmingham.
Yet the company’s like-for-like situation wasn’t quite as perky. As expected, Midway Attractions – which includes Madame Tussauds and the various Dungeon properties – saw a like-for-like sales decline of 0.7%; more worryingly there was a 0.3% drop in the Legoland division, something that was a real sticking point for investors. Resort Parks, meanwhile, saw an 8.3% jump in comparable sales.
The firm went on to state that though it is anticipating reporting 2018 results ‘in line with market expectations’, that is going to be dependent on its performance over the key trading weeks between Halloween and Christmas.
Merlin Entertainments shares have a consensus rating of ‘Buy’ alongside an average target price of £4.03.
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