Why the upward revision in target prices?
Since the announcement of its first-quarter results on June 11, several analysts have raised their price targets for Dave & Buster’s Entertainment (PLAY) stock. Apart from strong results, another major highlight of the quarterly announcement were the changes at the top management level. Dave & Buster’s announced that CFO (chief financial officer) Brian Jenkins will take over the CEO responsibilities from Stephen M. King, who will retire in August. However, King will remain the chair of the board of directors, according to the company.
The following analysts revised their target prices for Dave & Buster’s:
- Raymond James revised its price from $52.50 to $60.00.
- BMO revised its target price from $49.00 to $64.00.
- Canaccord Genuity raised its target price from $60.00 to $65.00.
- Jefferies raised its target price from $51.00 to $63.00.
On June 12, all ten analysts covering Dave & Buster’s stock rated the stock a “buy.” Currently, analysts’ 12-month average target price for the company is $62.33, which reflects an 11.7% upside to its price on June 12.
Dave & Buster’s reported first-quarter adjusted EPS (earnings per share) of $1.04, which was 11.8% better than the analyst estimate. Sales of $332.2 million beat analysts’ estimate by 3.3% and reflected YoY (year-over-year) growth of 9.2%. The company’s sales were primarily driven by new store openings. The company opened six new stores in the quarter.
Where do peers stand?
Out of the 26 analysts covering Dunkin’ Brands (DNKN), ~31% gave the stock a “buy” rating, and 54% gave it a “hold” rating. Currently, analysts’ target price for Dunkin’ Brands is $63.68, reflecting a 6.3% downside to the stock price as of June 12.
For Jack in the Box (JACK), 47.0% of the 17 analysts covering the stock recommended a “buy” rating, while 53.0% rated it as a “hold.” Jack in the Box’s target price is $97.71, implying 15.0% upside to the stock price as of June 12.
For Darden Restaurants (DRI), ~58.0% of the 26 analysts covering the stock recommended a “buy” rating, while 38.0% rated it as “hold.” Darden’s mean target price is $101.19, which indicates a 9.0% upside to the stock price as of June 12.