DexCom earnings beat by $0.03, revenue topped estimates
On Tuesday, Piper Sandler analyst Brian Mullan adjusted the price target for Dave & Buster's (NASDAQ:PLAY) shares, reducing it to $22.00 from the previous $33.00 while maintaining a Neutral rating. The revision followed the company's fiscal fourth-quarter 2024 results, which were released after the market closed. Dave & Buster's reported same-store sales (SSS) declining by 9.4%, a figure that underperformed against the consensus estimate of a 6.6% drop.
Despite the SSS miss, the analyst pointed out that the market had already set low expectations for the entertainment and dining venue operator, as reflected in the year-to-date stock price decline of approximately 45%. On a brighter note, Dave & Buster's mentioned in their earnings release that they have seen an improvement in business trends during March and April, although the extent of this improvement was not quantified during the earnings call.
Mullan highlighted that during the call, management emphasized a strategy of returning to basics to improve the business. However, he expressed skepticism about the effectiveness of this approach, noting that it remains uncertain whether the company was performing well even before the pandemic from a same-store sales perspective. The analyst suggested that investors will need to see more substantial evidence of a turnaround before confidence in the company can be restored.
In other recent news, Dave & Buster's Entertainment reported its fourth-quarter fiscal 2024 earnings, revealing results that fell short of analyst expectations. The company announced an adjusted earnings per share (EPS) of $0.69, missing the anticipated $0.72, while revenue was reported at $534.5 million, below the forecasted $549.05 million. Despite these misses, the company has launched new games and reopened its first international franchise in India as part of its growth strategy. Raymond (NSE:RYMD) James maintained a Market Perform rating on the stock, noting a 9.4% decline in comparable store sales but acknowledging improved store margins of 28.9%. The firm expressed concerns about the sustainability of cost reductions and the company's remodel program. Dave & Buster's plans to cap fiscal 2025 capital expenditures at $220 million and is actively searching for a new CEO. The company aims to open 10-12 new stores, with future EPS forecasts for fiscal 2025 and 2026 projected at $2.67 and $2.91, respectively. Despite challenges, interim CEO Kevin Sheehan expressed confidence in the company's strategic direction, emphasizing improvements in revenue, adjusted EBITDA, and shareholder value.
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