Cautious Hold Rating for Dave & Buster’s Amid Mixed Financial Performance

William Blair analyst Sharon Zackfia has maintained their neutral stance on PLAY stock, giving a Hold rating today.

Sharon Zackfia has given her Hold rating due to a combination of factors affecting Dave & Buster’s Entertainment. The company’s first-quarter sales showed some positive trends, with a smaller decline in comparable sales than initially expected. However, despite these improvements, the adjusted EBITDA fell short of consensus expectations, partly because of increased spending on marketing and maintenance.
While there was a noticeable improvement in sales trends from February to April, and further into the second quarter, the overall financial performance was mixed. The growth in food and beverage sales outpaced that of entertainment, driven by successful promotions and reduced discounting. Despite these positive signs, the mixed results and missed EBITDA targets led to a cautious approach, justifying the Hold rating.

In another report released today, UBS also maintained a Hold rating on the stock with a $29.00 price target.