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The 6 Devastating Financial Stages of SeaWorld's Collapse

4. Investors run away screaming

 Mike Aguilera/SeaWorld® San Diego

Over 41 million shares of SEAS exchanged hands on August 13, 2014. This was for a stock that had only reached 10 million in stock transactions in a single day only once before, the day of its IPO. The 41 million shares represent more activity than the SEAS stock had claimed during the entire previous month in combination.

Suffice to say that most of the people were selling, not buying. On August 13, 2014, SEAS closed at $18.90, a single day drop of $9.25. Overnight, its market cap went from $2.53 billion to $1.7 billion. After announcing an increase in quarterly earnings of $53.2 million, the total value of SeaWorld Entertainment collapsed by $800 million.

Welcome to the bizarre world of stock trading where perception equals reality. Investors were bullish about SeaWorld’s recovery heading into the summer of 2014. Once the numbers reinforced the fact that 2014 attendance was down significantly with a 4.3 percent decline, the belief that Blackfish had damaged the SeaWorld brand became pervasive.

5. The aftermath AKA "The Silence of the Killer Whales"

 Mike Aguilera/SeaWorld® San Diego

Notably, the $1.7 billion market cap for SEAS on Black Wednesday last August became its benchmark for the body of 2014. The stock traded with a closing price within two dollars of $18.9 for the majority of 2014. September 24, 2014, was the last day it reached $20, though.

By December of last year, SEAS had fallen under $16 before staging a slight recovery at the end of the year. On the final trading day of 2014, SEAS closed at $17.90 with a market cap of $1.54 billion. In roughly 18 months, the SEAS IPO that debuted to $3.43 billion was worth over $1.9 billion less. A $2 million-earning documentary (and some unfortunate business practices) had cost the company almost $2 billion in value. 

6. The road to recovery

 Mike Aguilera/SeaWorld® San Diego

2015 has proven that time heals all wounds. Attendance during the first quarter of the year was up from 3.0 million in 2014 to 3.2 million. Revenue increased a modest 1 percent to $214.6 million. The company retains staggering debt of $1.64 billion, so all of these numbers suggest continued struggles. Despite them, the stock is trading around $21 once more, and the market cap for SEAS has increased to almost $2 billion. Simply stated, investors believe that the negative publicity from Blackfish has gone away, and so SeaWorld Entertainment is perceived as a viable stock once again. Effectively, many agree that SeaWorld was punished for its transgressions, served its time and is now ready to move forward in the ultra-competitive world of theme park tourism.

No matter where you stand on SeaWorld’s treatment of the marine animals that are the showcase of their parks, there is simply no disputing the fact that Blackfish was a huge black eye for the company and had a devastating financial impact. It has caused sinking attendance and static revenue during a time when most major theme parks are enjoying explosive growth. The question now becomes whether SeaWorld has weathered the storm or if their brand has become irretrievably damaged. The company’s August financial report will go a long way in deciding which one is true.

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There are 2 comments.

Hearing and learning about the issue I have come to the conclusion that orcas and don't dolphins don't belong in captivity. I think we can all agree that locking up a German Shepard in a 10 by 10 room it's whole life is cruel.Sure you feed it, give it care and don't physically abuse it but is it moral or right? Same here.

Sea World no puede negar la realidad de CALDERON,.ya deberia entregar a todos los cetaceos que mantiene esclavos para su rehabilitacion y liberacion,.no es digno mantenerlos drogados y encerrados de por vida para diversion cruel y lucro,Y CON EL RIESGO SIEMPRE LATENTE DE QUE PUEDA OCURRIR UNA NUEVA DESGRACIADA MUERTE HUMANA.BLACKFISH es la salvacion para darle final a una industria dañina al medio ambiente y a la educacion familiar.

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