Jefferies Lifts Numbers on Dave & Buster's (PLAY) Following Strong Q3
Jefferies reiterated a Buy rating on Dave & Buster's (NASDAQ: PLAY), and raised the price target to $50.00 (from $45.00), following the company's 3Q earnings report. SSS increased 8.8% in 3Q, better consensus of +5%, and accelerated by 80 bps on a two-year basis, despite 110 bps negative impact from the timing of Halloween. Strength was driven by walk-ins, which increased 9% y/y, helped by increased marketing/promotions, including Summer of Games and the exclusive launch of Angry Birds as well as All You Can Eat Wings during the first three Sundays and Mondays of NFL season.
Analyst Andy Barish commented, "$0.12 adj. EPS was 4x above Cons. on strong SSS of +8.8% (Jef/Cons. +3%/+5%), despite tough year ago comps. '15 outlook was raised again, but could still be conservative, while preliminary '16 guide indicates growth above LT targets. Our ‘15/’16E EBITDA ests. increase to $186/$220mm (fr. $177/$205mm) and we are introducing our '17 EBITDA est. of $246mm. Our PT goes to $50 (fr $45). Reiterate Buy."
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Shares of Dave & Buster's closed at $39.40 yesterday.