Dave & Buster’s Entertainment Inc. (PLAY): Technical Analysis Suggests You Should Hold

The stock of Dave & Buster’s Entertainment Inc. (NASDAQ:PLAY) increased by increased by $1.37 on Friday to finish at $38.27, up 3.71 percent. The last five days have seen an average of 1,113,040 shares of common stock traded. 28 times new highs were reached in the current year, with a gain of $8.25. The average number of shares traded over the last 20 days was 1,031,935, while the average volume over the last 50 days totaled 1,386,972.

PLAY stock dropped -3.96% since last month. On 10/20/21, the company’s shares reached a one-month low of $35.05. The stock touched a high of $51.73 on 03/26/21, after rallying from a low of $16.33 in 52 weeks. The price of PLAY stock has risen by 27.48% or $8.25 this year, reaching a new high 28 times. Still, the stock price is down -26.02% from the 52-week high.


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Insider Transactions

There have been 39 days since Dave & Buster’s Entertainment Inc. (PLAY) last reported insider trading activity on Sep 16. On Sep 16, SVP, RE & Dev Mulleady John sold 10,000 shares at $36.10 each. This transaction resulted in the insider making $361,025. On Sep 15, Mulleady John sold 7,500 shares at a price of US$35.08. After the transaction, the insider now owns 76,729 shares. Chief Executive Officer JENKINS BRIAN had earlier sold 10,186 shares on Sep 10 for $40.00 a share. The transaction was completed for $407,440.

Valuation Metrics

The PE ratio of Dave & Buster’s Entertainment Inc. has varied between 59.91 and 1.709 in the last five years. Beta for the stock is 1.99. There are also a few other valuation ratios worth considering, including the trailing price-to-sales (P/S) ratio of 2.05, the price-to-book (PB) ratio of 8.02, and the price-to-cash flow ratio of 16.96.

Dave & Buster’s Entertainment Inc.’s dividend is $0.64 per share per year. On Feb. 10, the company paid $0.16 per share in dividends, remained unchanged from $0.16 last year. A $0.01 dividend increase was reported on Monday September 23 2019.

For the three months ended July 30, Dave & Buster’s Entertainment Inc.’s quick ratio was 0.60, while its current ratio was 0.60, indicating its inability to pay off its debt. As far as profitability goes, gross margin for the trailing twelve months is 84.40% percent. Dave & Buster’s Entertainment Inc.’s EBITDA margin for the year ended July 30 was -19.95%, whereas its operating margin stood at 0.60% for the same period. Based on annual data, it had gross profit of $361.61 million and revenue of $436.51 million.

Investors will also look at the performance of the company’s management in order to determine the potential profitability of their investment. PLAY’s return on assets (ROA) during the last 12 months has been -1.40%. There was a -22.70% return on investment (ROI) in the past year. In the meantime, the return on equity (ROE) for the last 12 months was -16.90%. ROE has averaged 10.14 in the past year for the broader industry.

Earnings Surprise

According to Dave & Buster’s Entertainment Inc.’s quarterly financial report for the quarter that ended July 30. A higher net income was reported in the quarter under review than the previous quarter. Net income for the quarter came in at $377.64 million, while revenues rose by 86.54% to $265.34 million. It was predicted that Dave & Buster’s Entertainment Inc.’s quarterly earnings would be $1.07, but it ended up being $0.58, beating the consensus by 84.50%. EBITDA was $114.04 million for the quarter. At the end of Dave & Buster’s Entertainment Inc.’s most recent quarter ended July 30, its liabilities totaled 2.15 billion, while its total debt was $1.86 billion. Equity owned by shareholders amounts to $48.26 million.

Technical Picture

Here’s a quick look at Dave & Buster’s Entertainment Inc.’s (PLAY) price momentum from a technical perspective. As of 22 October, the RSI 9-day stood at 52.79%, suggesting the stock is Neutral, with a 36.65% historical volatility rate.

The stochastic %K and %D were 28.73% and 15.97% respectively, while the average true range (ATR) was 1.71. Based on the 14-day stochastic reading of 48.46%, the RSI (14) reading is 51.62%. On the 9-day MACD Oscillator, the stock is at -0.40, and the 14-day reading is at -1.23.

Analyst Ratings

In its analyst report released on October 06, 2021, Loop Capital began covering Dave & Buster’s Entertainment Inc. (NASDAQ: PLAY). The stock was rated as a Buy by the brokerage firm. Analysts have assigned Dave & Buster’s Entertainment Inc. (PLAY) an Overweight rating. PLAY is a stock that is recommended for selling by 1 brokerage firm, while 3 companies recommend holding. The stock is underweighted by 0 analysts. Among the analysts who rate the stock, 0 rates it overweight and 7 others recommend it as a buy.

What is PLAY’s price target for the next 12 months?

The current consensus forecast for the stock is between $40.00 and $58.00, with a median target price of $54.00. In analyzing these forecasts, the average price target given by analysts for Dave & Buster’s Entertainment Inc. (PLAY) is $50.60.

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