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Dave & Buster's (PLAY) Gains But Lags Market: What You Should Know

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Dave & Buster's (PLAY - Free Report) closed the most recent trading day at $38.05, moving +0.26% from the previous trading session. This move lagged the S&P 500's daily gain of 1.84%. Meanwhile, the Dow gained 1.33%, and the Nasdaq, a tech-heavy index, added 0.74%.

Coming into today, shares of the owner of Dave & Buster's, a chain of restaurants and arcades had lost 20.46% in the past month. In that same time, the Retail-Wholesale sector lost 5.5%, while the S&P 500 lost 0.5%.

Dave & Buster's will be looking to display strength as it nears its next earnings release, which is expected to be June 7, 2022. In that report, analysts expect Dave & Buster's to post earnings of $1.19 per share. This would mark year-over-year growth of 197.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $441.28 million, up 66.31% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.34 per share and revenue of $1.67 billion, which would represent changes of +51.13% and +28.05%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Dave & Buster's. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Dave & Buster's is currently a Zacks Rank #2 (Buy).

Looking at its valuation, Dave & Buster's is holding a Forward P/E ratio of 11.36. For comparison, its industry has an average Forward P/E of 19.65, which means Dave & Buster's is trading at a discount to the group.

Meanwhile, PLAY's PEG ratio is currently 0.76. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. PLAY's industry had an average PEG ratio of 1.82 as of yesterday's close.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 193, which puts it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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