Dave & Busters Entertainment (PLAY) AI Stock Analysis

• Market Cap: $658.32M
• Dividend Yield: N/A
• Average Volume (3M): 1.47M
• Price to Earnings (P/E): 52.1
• Beta (1Y): 0.81
• Revenue Growth: -4.46%
• EPS Growth: -86.94%
• Country: US
• Employees: 23,420
• Sector: Communication Services
• Sector Strength: 97
• Industry: Entertainment
• EPS (TTM): 0.32
• Shares Outstanding: 34,666,565
• 10 Day Avg. Volume: 2,106,355
• 30 Day Avg. Volume: 1,467,389
• PEG Ratio: -0.37
• Price to Book (P/B): 7.34
• Price to Sales (P/S): 0.50
• P/FCF Ratio: -4.91
• Enterprise Value/Market Cap: 6.78
• Enterprise Value/Revenue: 2.11
• Enterprise Value/Gross Profit: 4.33
• Enterprise Value/Ebitda: 11.36
• 1Y Price Target: $31.00
• Price Target Upside: 71.84% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 54 Neutral
• Price Target: $20.50 ▲(13.64% Upside)

Dave & Busters Entertainment's overall stock score is primarily impacted by financial performance challenges, including high leverage and declining profitability margins. Technical analysis indicates a bearish trend, further weighing on the score. The earnings call provided some positive strategic initiatives, but operational challenges remain a concern. Valuation is moderate, but the lack of a dividend yield is a drawback for some investors.

Positive Factors

Same-Store Sales Improvement

The improvement in same-store sales indicates effective strategic changes, suggesting potential for sustained revenue growth and market competitiveness.

Successful Marketing Initiatives

Effective marketing initiatives enhance customer engagement and drive traffic, supporting long-term revenue stability and brand loyalty.

Leadership Vision

Strong leadership vision focused on customer experience and growth can lead to improved operational execution and long-term business success.

Negative Factors

Declining Revenue Growth

Negative revenue growth reflects challenges in maintaining sales momentum, which could impact long-term financial stability and market position.

High Leverage

High leverage increases financial risk and limits flexibility, potentially affecting the company's ability to invest in growth and weather economic downturns.

Increased Operating Expenses

Rising operating expenses can pressure margins and profitability, challenging the company's ability to sustain long-term financial health.

Dave & Busters Entertainment Business Overview & Revenue Model

Company Description

Dave & Buster's Entertainment, Inc. owns and operates entertainment and dining venues for adults and families in North America. Its venues offer a menu of entrées and appetizers, as well as a selection of non-alcoholic and alcoholic beverages; and an assortment of entertainment attractions centered on playing games and watching live sports, and other televised events. The company operates its venues under the Dave & Buster's name. As of January 30, 2022, it owned and operated 144 stores located in 40 states, Puerto Rico, and one Canadian Province. The company was founded in 1982 and is headquartered in Coppell, Texas.

How the Company Makes Money

Dave & Buster's generates revenue primarily through two key streams: food and beverage sales, and amusement and entertainment sales. The food and beverage segment includes the sale of a diverse menu featuring appetizers, entrees, desserts, and a wide selection of alcoholic and non-alcoholic beverages. The amusement segment derives income from the operation of arcade games, virtual reality experiences, and other entertainment attractions, which typically require the purchase of game cards or tokens. Additionally, the company benefits from hosting corporate events, birthday parties, and special occasions, which can lead to group bookings and event packages. Strategic partnerships with game developers and suppliers also enhance its offerings and may provide financial incentives or support. Seasonal promotions and loyalty programs further boost customer engagement and repeat business, contributing to overall earnings.

Dave & Busters Entertainment Financial Statement Overview

Summary

Dave & Busters Entertainment faces pressures in profitability and financial stability, with declining revenues and high leverage posing significant challenges. The company benefits from improved operating cash flow efficiency, but the omission of key free cash flow metrics restricts a comprehensive evaluation.

Income Statement

Dave & Busters Entertainment has demonstrated a modest financial performance. The gross profit margin remains high at 100% in 2025 due to the same gross profit and total revenue, which may indicate a data reporting issue. The net profit margin has decreased to 2.73% from 5.76% in 2024, showing a decline in profitability. Revenue growth was negative at -3.3% from 2024 to 2025, reflecting challenges in maintaining sales momentum. The EBIT margin fell to 10.34% from 13.9% in 2024, while the EBITDA margin declined to 20.8% from 22.84% previously, indicating reduced operational efficiency.

Balance Sheet

The company faces significant leverage with a debt-to-equity ratio of 10.85 in 2025, indicating high financial risk. Stockholders' equity has sharply decreased, reducing the equity ratio to 3.63%, down from 6.69% in 2024, suggesting weakened financial stability. Return on equity dropped to 39.97% from 50.53% in 2024, reflecting reduced profitability relative to equity.

Cash Flow

The company's cash flow situation presents mixed signals. Operating cash flow to net income ratio improved to 5.36 from 2.87 in 2024, showing better cash conversion of profits. However, the absence of a calculated free cash flow growth rate and free cash flow to net income ratio limits a thorough analysis. Overall, while operating efficiency appears to have improved, the lack of data on free cash flow is a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.11B	2.13B	2.21B	1.96B	1.30B	436.51M
Gross Profit	1.03B	1.82B	723.90M	1.66B	1.10B	361.61M
EBITDA	392.80M	443.40M	503.70M	426.87M	312.35M	-116.89M
Net Income	9.70M	58.30M	126.90M	137.10M	108.70M	-206.97M
Balance Sheet
Total Assets	4.09B	4.02B	3.75B	3.76B	2.35B	2.35B
Cash, Cash Equivalents and Short-Term Investments	12.00M	6.90M	37.30M	181.59M	25.91M	11.89M
Total Debt	1.55B	3.14B	3.00B	2.86B	1.75B	1.86B
Total Liabilities	3.93B	3.87B	3.50B	3.35B	2.07B	2.20B
Stockholders Equity	166.20M	145.80M	251.20M	410.54M	275.46M	153.23M
Cash Flow
Free Cash Flow	-313.40M	-217.90M	34.00M	210.24M	190.93M	-132.24M
Operating Cash Flow	231.50M	312.30M	364.20M	444.47M	283.13M	-49.22M
Investing Cash Flow	-540.40M	-529.80M	-329.10M	-1.05B	-91.47M	-81.96M
Financing Cash Flow	307.80M	187.10M	-179.40M	762.81M	-177.64M	118.42M

Dave & Busters Entertainment Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 18.04
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PLAY, the sentiment is Negative. The current price of 18.04 is below the 20-day moving average (MA) of 20.99, below the 50-day MA of 24.48, and below the 200-day MA of 24.42, indicating a bearish trend. The MACD of -1.79 indicates Positive momentum. The RSI at 28.20 is Positive, neither overbought nor oversold. The STOCH value of 13.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PLAY.

Dave & Busters Entertainment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNK	66 Neutral	$3.22B	15.38	65.32%	0.86%	13.80%	109.00%
MCS	66 Neutral	$466.84M	35.07	1.46%	1.90%	13.28%	―
SBGI	64 Neutral	$1.02B	18.90	53.17%	6.80%	8.11%	―
PLAY	54 Neutral	$658.32M	52.09	4.31%	―	-4.46%	-86.94%
AMCX	51 Neutral	$358.78M	-1.89	-17.99%	―	-7.25%	-395.48%
AMC	49 Neutral	$1.51B	-3.31	21.04%	―	9.42%	39.83%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%