Viad Corporation (VVI:BUY) Revenue beat driven by positive show rotation and base same-show growth in U.S. Marketing & Events group.

Q1:14 HIGHLIGHTS

• Revenue increased 0.2% year-over-year to $285.6 million in Q1:14 and was above our forecast of $279.3 million primarily due to higher than expected revenue in the U.S. Marketing & Events business.
• EPS of $0.36 was in-line with our estimate as the revenue beat was offset by higher than expected corporate activities expense.
• The soft opening of the Glacier Skywalk in Jasper National Park has received positive feedback and is on schedule to open next week (May 2014).
• Management announced the completion of the company’s strategic review process and has determined it would not be in the best interest of shareholders to separate the M&E and T&R businesses at this point in time. The company will continue its focus on improving operating efficiencies and pursuing organic and external growth opportunities.
• In light of management guidance, we lower our Q2:14 revenue estimate to $243.9 million from $250.8 million and lower our EPS estimate to $0.40 from $0.50. Our FY:14 EPS estimate of $1.60 remains unchanged as we raise our Q3:14 and Q4:14 estimates by $0.05 each.
• We maintain our BUY rating and $34 price target for the shares. We will revisit our forecast and provide more discussion after the release of the company’s 10-Q filing.