Short interest on United Parks & Resorts, the parent company of SeaWorld, Busch Gardens, and Sesame Place theme parks, is covering 15-20% of the float. But that massively understates the potential for a squeeze.
Hill Path Capital owns 58% of $PRKS. Their ownership stake has grown passively as United has bought back $400M of stock. The current buyback must stop if Hill Path’s ownership grows to 70%. It won’t on this injunction, $PRKS is only authorized for $500M in buybacks, but it could on the next one. 97% of non Hill Path shareholders approved the $500M buyback plan - they’ll do it again.
Their earnings consistently show higher per-capita guest spending, but shrinking guest attendance. They are also carrying substantial long-term debt, as most theme parks do. The pattern won’t hold forever - which is what short sellers are betting on.
The twist: land. Serious buyers have offered (private) valuations for United’s real estate that exceed the public market’s total $PRKS valuation. For example, over 400 acres bordering SeaWorld Orlando. Land in that corridor runs $500-600k per acre. SeaWorld and Universal are holding Orlando’s most valuable undeveloped land, and Universal has no interest in selling.
Also of note: the $PRKS governing documents were amended in 2024 to outline the path & regulations for a take-private offer from Hill Path Capital. Their stake was only 42% then; it’s 58% now.
The potential squeeze plays out like this: a property sale generates $200-300M of free cash. $PRKS requests another buyback authorization. Hill Path’s ownership stake grows to 70% and they offer to take the company private. Short sellers, who now short well beyond half of the float after all the buybacks, rush to close their positions.
The real problem with this squeeze setup is the timeline: it would probably take 12 full calendar months from land sale to take-private finalization. Short sellers would have time to gradually exit. Unless…
The Orlando land sale isn’t priced in, while the future buybacks & take-private are. Management has been clear about land sale negotiations. They’ve been extremely hand-wavy about timeline. The last two earnings cycles, they’ve mentioned the land sale, but the operational misses have dominated price movements.
I’m betting on that sale happening in the next year. When it does, the buyback & take-private speculation squeezes the stock like Volkswagen in 2008, which went more than 400%. My position: currently 100 shares, planning to buy more. See you on the moon.