Intrinsic Value Compagnie des Alpes S.A. (CDA.PA)

• Previous Close: €26.00
• Intrinsic Value: €8.92
• Upside potential: -66%

Stock Valuation Context

Business Model And Market Position

Compagnie des Alpes SA is a leading European leisure company specializing in ski resorts and theme parks. Its diversified portfolio includes iconic ski destinations such as La Plagne, Méribel, and Val d'Isère, alongside well-known leisure parks like Parc Astérix and Futuroscope. The company operates through three segments: Ski Areas, Leisure Parks, and Holdings and Supports, each contributing to a resilient revenue model that balances seasonal and year-round attractions. With a strong foothold in France and expanding presence in Belgium and the Netherlands, the company leverages its brand equity and operational expertise to attract tourists and real estate developers. Its integrated approach—combining lift operations, ski area maintenance, and real estate sales—enhances profitability while mitigating weather-related risks. The Leisure Parks segment benefits from recurring visitor traffic, supported by strategic investments in new attractions and partnerships. Compagnie des Alpes holds a competitive edge through its scale, geographic diversification, and ability to monetize both leisure and real estate assets, positioning it as a key player in the European leisure industry.

Revenue Profitability And Efficiency

In FY 2024, Compagnie des Alpes reported revenue of €1.24 billion, reflecting steady demand across its ski and leisure segments. Net income stood at €92.4 million, with diluted EPS of €1.81, indicating robust profitability. Operating cash flow of €341.1 million underscores efficient operations, though capital expenditures of €252.8 million highlight ongoing investments in infrastructure and park enhancements to sustain growth.

Earnings Power And Capital Efficiency

The company demonstrates solid earnings power, driven by high-margin ski lift operations and theme park admissions. Its capital efficiency is evident in the balance between reinvestment (€252.8 million in capex) and cash generation (€341.1 million operating cash flow). However, the elevated total debt of €1.5 billion suggests leveraged growth, requiring careful management of interest coverage and liquidity.

Balance Sheet And Financial Health

Compagnie des Alpes maintains a mixed financial position, with €234.1 million in cash against €1.5 billion in total debt. The leverage ratio warrants monitoring, though strong operating cash flow provides flexibility. The company’s ability to service debt and fund expansions hinges on consistent performance across its seasonal and non-seasonal segments.

Growth Trends And Dividend Policy

Growth is supported by strategic capex in ski resorts and theme parks, aiming to enhance visitor experiences and extend operational seasons. The company pays a dividend of €1 per share, signaling confidence in cash flow stability. Future trends may depend on tourism recovery, weather conditions, and real estate market dynamics in its key regions.

Valuation And Market Expectations

With a market cap of €891.6 million and a beta of 1.33, the stock reflects moderate volatility tied to leisure sector cyclicality. Investors likely price in recovery potential post-pandemic, balanced against debt levels and operational risks. The P/E ratio, derived from €1.81 EPS, suggests market expectations align with sector peers.

Strategic Advantages And Outlook

Compagnie des Alpes benefits from brand strength, geographic diversification, and integrated revenue streams. Near-term challenges include debt management and weather dependency, but long-term prospects are bolstered by tourism demand and real estate synergies. Strategic investments in sustainability and digitalization could further enhance competitiveness in the evolving leisure market.

Sources

Company filings, Euronext Paris disclosures