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Truist Securities reiterated its buy rating and $11.00 price target on Lucky Strike Entertainment (NYSE:LUCK) Friday, citing improved consumer spending patterns in recent months. Currently trading at $8.91, InvestingPro analysis indicates the stock is slightly overvalued based on its proprietary Fair Value model.
The research firm adjusted its fourth-quarter and fiscal year 2025 estimates above consensus, based on enhanced spending trends observed in May and June according to Truist Card Data. The company, with a market capitalization of $1.25 billion and revenue growth of 6.65% over the last twelve months, has seen potential shifts toward local entertainment options among consumers.
Weather conditions have also played a role in Lucky Strike’s recent performance, with Truist highlighting that rainy conditions during the fourth fiscal quarter and strong summer pass sales have positively influenced business trends. InvestingPro data reveals that while management has been actively buying back shares, the company operates with significant debt obligations.
While group and corporate business remains uncertain, Truist believes Lucky Strike is positioned for accelerated EBITDA growth over the coming 12 months, assuming consumer spending remains stable.
The firm projects earnings growth to accelerate in the year ahead, estimating approximately 7% growth in fiscal year 2026 compared to the 1%-2% EBITDA growth rate observed over the past 24 months, despite what it describes as a generally lackluster macroeconomic environment.
In other recent news, Lucky Strike Entertainment reported its Q1 2025 earnings, revealing a miss on both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $0.21, falling short of the $0.25 forecast, while revenue reached $339.9 million, below the expected $358.29 million. These results have raised concerns among investors, as the company’s performance diverged from previous quarters where projections were typically met or exceeded. Furthermore, Roth/MKM analysts downgraded Lucky Strike’s stock rating from Buy to Neutral, with a revised price target of $9.00, down from $13.00, citing prolonged fundamental challenges and economic uncertainties affecting the company’s Corporate Events segment.
Despite these setbacks, Lucky Strike reported a 0.7% increase in total revenue year-over-year, with food sales rising by 8%, indicating a potential area of strength. The company is also focusing on strategic initiatives such as food and beverage innovation and expanding entertainment offerings to drive growth. Meanwhile, Lucky Strike has removed specific financial guidance due to market volatility, though it remains optimistic about improved performance in the upcoming summer months. The company also announced the acquisition of Shipwreck Island in Panama City Beach, Florida, for $30 million, signaling a continued investment in growth through acquisitions.
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