How a thriving theme park chain reflects a shift in consumers' mentality

The theme park business is thriving because of a “shift” in consumers’ mentality, according to Matt Ouimet, CEO of Cedar Fair (FUN)—which owns and operates 11 amusement parks and 2 water parks across North America.

“I think what we’re experiencing is this shift of the consumer from a retail mentality to an experience mentality,” Ouimet said. “Clearly consumers are looking for experiences and we’re part of that.”

Indeed, earlier this year the Washington Post reported that shoppers continue to choose experiences over stuff, as reflected in surges in airline tickets, restaurant sales and streaming services. Meanwhile, traditional retailers like Macy’s (M), Nordstrom (JWN) and Gap (GPS) continue to report declining sales.

Cedar Fair, which announced record results through Labor Day weekend, serves as a value-oriented “staycation,” according to Ouimet.

And while summer may be over, the company has aimed to expand the momentum into fall with Halloween—with 15% of the year’s business coming in October—and winter, with a WinterFest offering.

Low gas prices have helped to some degree as well, Ouimet added, though he doesn’t see that as being as important a driver to his parks, which include Dorney Park and Kings Dominion.

Ouimet added his company doesn’t compete directly with Disney (DIS)—which has struggled amid concerns about ESPN subscribers and future growth despite its theme park strength—but instead offers a value-oriented alternative.

Shareholder return

Ouimet also said he credits much of the stock’s strength to its commitment to return capital to shareholders.

The company, a master limited partnership (MLP), sports a 6% dividend yield.

“People do own us to a great degree because of that 6% yield,” he said. “Over the last 30 years on average, we’ve returned 17% to our investors.”

While the company continues to invest to improve its parks—especially to retain its ticket holders, 50% of whom are season pass holders—the top priority is returning cash to shareholders, Ouimet said.

Nicole Sinclair is markets correspondent for Yahoo Finance.