Leisure and entertainment company Ardent Leisure Group Ltd's (ASX: ALG) share price topped the leader's board on the ASX last week. The Ardent Leisure share price gained a whopping 22.7% in the first trading week of August.
Things got off to a rockier start for the company this week, with Ardent's share price falling 3.6% by this morning's opening bell. And shareholders looked to be in for more pain in early morning trade today as Ardent Leisure's share price fell 5% in less than an hour.
Like one of the company's amusement park rides, though, the share price came shooting back up to recoup all those losses by mid-afternoon trade.
Ardent Leisure's share price gain of 21.2% for August still puts it at the top of the big gainer's board.
Of course, it's got a lot further to climb before regaining all of 2020's massive losses.
Like most shares on the ASX — particularly companies tied to travel and entertainment — the COVID-19 market rout hit the Ardent share price hard. From 21 February to 25 March, Ardent's share price cratered by 92%.
Since the 25 March low, the company's shares have shot up an impressive 264%. Yet it's still far shy of where it began the year, down nearly 70% since 2 January.
That's seen its market capitalisation reduced to $189 million.
What does Ardent Leisure do?
Ardent Leisure is an Australian leisure and entertainment group. The company owns and operates premium leisure assets which include Dreamworld, WhiteWater World and SkyPoint theme parks.
Its Main Event portfolio also includes a growing number of family entertainment assets in the United States.
Why is the Ardent Leisure share under pressure after last week's 23% gain?
Last week, Ardent Leisure's share price got a boost when the company announced it was reopening Dreamworld and WhiteWater World in mid-September. Continued social distancing measures, however, mean the theme parks will be limited to 50% capacity.
The share price was also buoyed after Ardent announced it was receiving a $66.9 million loan plus a grant of $3 million from the Queensland Government's COVID-19 industry support package.
Two factors are likely seeing Ardent's share price falling this week.
First, after a 23% increase, it's natural to expect that several short-term investors will be selling shares to pocket some gains.
Second, the news out of New Zealand regarding renewed COVID-19 cases, and the subsequent lockdowns in Auckland, is likely scaring investors away from a company that's so reliant on international and interstate tourism.
