Why SeaWorld Entertainment Stock Leaped 22% in May
Shares of aquatic-themed amusement park operator SeaWorld Entertainment (NYSE: SEAS) advanced an impressive 22% in May according to data from S&P Global Market Intelligence. Although that was nice to see, the stock was still down more than 40% year to date through the end of May. And yet, SeaWorld's shares have managed to recover from the worst of their dive in February and March, a drop that left the stock lower by around 80% at one point.
The steep drop and the partial recovery are tied at the hip here and entirely related to COVID-19. As the virus started to spread, the government effectively shut the U.S. economy down by asking people to practice social distancing and closing non-essential businesses. Amusement parks are definitely not essential and, worse, they bring lots of people into close proximity -- which is exactly the type of situation in which the coronavirus can easily spread. Investors were frightened that SeaWorld's business model would be irreparably broken.
Image source: Getty Images.
Source Fool.com
