Frozen Assets?

Wall Street takes a chilly view of skiing, but you can always invest in more slope time.

TICKER

American Skiing Company: AESK

BIO

ASC is the third-biggest player in skiing. Founder Leslie Otten built a portfolio that includes Killington, The Canyons, Sugarloaf and Steamboat, spending hundreds of millions of dollars buying and upgrading resorts before leaving the company in 2001.

BUCKS

Sales

$284 million (fiscal year ended July 25, 2004)

Profit or loss $28.5 million

BIZ (2-week high/low*) $0.60/$0.09

BUZZ ASC got lost in a blizzard of loans as it built its empire. Its debt peaked just about when New England snowfall bottomed out, and American saw five years of losses, including $200 million in fiscal 2002. On the bright side, this year’s loss is just a third of last year’s.

BOTTOM LINE** Not rated

TICKER Head: HED

BIO Howard Head revolutionized the sport when he invented the metal ski in 1950. But the company he founded, now based out of Vienna, makes almost as much money selling Head tennis racquets and Penn tennis balls as it does skis, boots and winter gear.

BUCKS
Sales $462 million (12 months through Sept. 30, 2004)

Profit or loss -$35 million

BIZ (2-week high/low*) 3.72/$2.25

BUZZ Since listing its shares in 2000, Head hasn’t been able to sustain profits. A restructuring plan is lowering expenses, as some manufacturing is moved from high-cost Austria to the far-cheaper Czech Republic. But analysts remain skeptical of the immediate future.

BOTTOM LINE** 3.0

TICKER Intrawest: IDR

BIO Intrawest is one of the top two resort operators in North America, with properties such as Copper Mountain, Colo., Tremblant, Que., and Whistler, B.C. Intrawest’s villages have proven so popular that other resorts have hired the company to develop their villages

BUCKS
Sales $1.55 billion (fiscal year ended June 30, 2004)

Profit or loss $60 million

BIZ (2-week high/low*) $20.31/$13.57

BUZZ Intrawest follows a strategy of geographic diversification. This means that if a thaw burns business at one of its properties, chances are conditions will be prime at another. And the village development division helps smooth out seasonal peaks and valleys.

BOTTOM LINE** 2.5

TICKER K2: KTO

BIO You might think you know K2. After all, it’s the company that brought out those nifty red-white-and-blue skis in the 1970s. But the company is also home to dozens of big-time sports brands, including Völkl, Marker, Rawlings, Marmot and Shakespeare.

BUCKS
Sales $1.06 billion (12 months through Sept. 30, 2004)

Profit or loss $32 million

BIZ (2-week high/low*) $19.00/$12.60

BUZZ K2 isn’t just a ski company anymore, but on Wall Street that’s a good thing, as it’s less weather-dependent than before. Less than a third of sales are now in winter sports. And it has moved much of its production to China, so it can beat many of its rivals on cost.

BOTTOM LINE** 1.4

TICKER Vail Resorts: MTN

BIO Vail Resorts is Intrawest’s main rival in the resort trade. The company runs Vail, Beaver Creek, Breckenridge and Keystone in Colorado, plus Heavenly at Lake Tahoe and a handful of posh hotels and beach destinations under the RockResorts brand.

BUCKS
Sales $722 million (fiscal year ended July 31, 2004)

Profit or loss -$6 million

BIZ (2-week high/low*) $23.50/$13.73

BUZZ Vail Resorts’ mountains are about as good as they come. But its geography works against it. Though Vail added Heavenly, Calif., two years ago, most of its revenues come from Colorado operations. Consequently, Wall Street remains nervous about bad snow years.

BOTTOM LINE** 2.5

*As of December 14, 2004.

**Ratings, from Thomson First Call, are 1-5, with 1 being the highest, or a strong buy recommendation.

FEBRUARY 2005