Dave & Buster’s ‘Is Back,’ Its CEO Says. The Stock Market Agrees.

Signage is displayed in the middle of an air hockey table at a Dave & Buster’s Entertainment location.

Timothy Fadek/Bloomberg

Analysts raised their price targets on Dave & Buster’s after the restaurant and entertainment chain topped Wall Street’s earnings expectations and CEO Brian Jenkins confidently stated that the brand “is back.” 

Earnings of $1.07 a share for the company’s fiscal second quarter nearly doubled estimates that called for a profit of 58 cents. 

Revenue jumped to $377.6 million from $50.8 million a year earlier—a time when the U.S. was deep into the pandemic—and $344.6 million in the second quarter of 2019. 

Same-store sales in the second quarter rose 3.6% compared with the same period in 2019, the company said. 

Dave & Buster’s expects third-quarter same-store sales to increase but slow to 1.3% compared with 2019. 

“Dave & Buster’s second quarter was clear evidence that the brand is back, posting record revenues and EBITDA with all 142 stores open as of the end of the quarter,” Jenkins said in a statement. 

“The entire team has demonstrated great resilience navigating the pandemic and positioning the company to achieve new levels of performance. Through continued execution of our strategic initiatives, including our new menu, optimized marketing, and technology investments, we are excited to move forward with a strong foundation to drive sustained profitable growth,” he added.

The stock gained 7.3% to $38.04 in trading Friday. 

Analysts clearly liked the results. 

BMO Research raised its price target on the stock to $58, which it estimates is nine times fiscal EBITDA, “reflecting the stronger business momentum.” It rates the stock at Outperform.

Analysts at Raymond James reiterated their Strong Buy rating on Dave & Buster’s, saying that same-store sales “accelerated meaningfully through the quarter” and remain positive quarter to date … despite “decelerating on delta variant concerns (thus potential to improve if cases/concerns ease), earlier back to school, and the impact of Hurricane Ida.” 

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