We recently compiled a list of the 12 Cheap Small-Cap Stocks to Invest In Before the Next Breakout. Dave & Buster’s Entertainment, Inc. stands fourth on our list of best small-cap stocks. TheFly reported on January 16 that Benchmark upgraded PLAY from Hold to Buy with a $30 price target. The firm cited a “credible setup” for positive same-store sales in Q1, which would mark the first such inflection in roughly 13 quarters. Benchmark’s conviction is supported by improving food and beverage execution and in ...

Core Viewpoint - Dave & Buster's reported mixed Q3 fiscal 2025 results, with earnings exceeding estimates but revenues falling short, reflecting ongoing challenges in the entertainment segment and comparable store sales [2][3][5]. Financial Performance - The company incurred an adjusted loss per share of $1.14, which was narrower than the consensus estimate of a loss of $1.16, compared to a loss of 45 cents in the same quarter last year [5]. - Quarterly revenues were $448.2 million, missing the consensus mark of $460 million by 2.6%, and decreased 1.1% from $453 million reported in the prior-year quarter [5]. - Food and Beverage revenues, accounting for 37.7% of total revenues, increased 6.6% year over year to $168.8 million, while Entertainment revenues, making up 62.3%, fell 5.2% year over year to $279.4 million [6]. Operational Highlights - Comparable store sales declined 4% year over year, but management noted steady monthly improvement, with October comps down only about 1% from the prior year [7]. - The operating loss for the quarter was $16.2 million, compared to an operating income of $6.3 million in the year-ago quarter, with adjusted EBITDA at $59.4 million, down from $68.3 million in the previous year [8]. Strategic Initiatives - The company is implementing a Back-to-Basics strategy, focusing on marketing, games innovation, operations, and remodels, which management believes will stabilize performance and enhance long-term shareholder value [4]. - New menu launches and increased adoption of the Eat & Play Combo have shown early positive results, contributing to better trends through the quarter and into November [4]. Balance Sheet and Liquidity - As of November 4, 2025, cash and cash equivalents were $13.6 million, up from $6.9 million as of February 4, 2025, while net long-term debt was approximately $1.55 billion [10]. - The company maintains available liquidity of $441.9 million, including its revolving credit facility [10]. Growth and Development - In Q3, the company opened one domestic store and three new Main Event locations, with plans for additional international openings and remodels scheduled for early 2026 [11][12]. Market Sentiment - Since the earnings release, there has been a downward trend in estimates revision, with the consensus estimate shifting down by 11.96% [13]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [15].

Core Insights - Dave & Buster's (NASDAQ: PLAY) is experiencing a stock reversal after a sell-off, with positive impacts from CEO changes, a Back-to-Basics strategy, and restaurant remodels, despite missing consensus estimates slightly [2] - The stock has shown a double-digit surge in prices, indicating a potential double-bottom reversal pattern, which suggests an improving business outlook [2][3] - Analysts predict a favorable growth trajectory for Dave & Buster's, with price targets indicating a double-digit upside from critical resistance points, suggesting a trend higher throughout 2026 [4][6] Financial Performance - The fiscal year 2026 Q3 results showed a net loss, but this was offset by reinvestment in a turnaround plan and a healthy balance sheet, with a nearly 12% reduction in share count due to share buybacks [6] - Sequential growth was logged in the latest results, indicating a positive trend despite the net loss [2][6] Market Dynamics - The stock is nearing critical mid-December resistance, forming a potential double-bottom reversal setup, which is a classic market signal for upward movement [5] - Analysts have noted a shift in market dynamics from distribution to accumulation, with the 150-day exponential moving average serving as a significant pivot point [7]

Core Insights - Dave & Buster's Entertainment, Inc. (PLAY) is implementing a focused remodel strategy as part of its Back to Basics plan, which has resulted in a 700-basis-point positive impact on performance in the third quarter of fiscal 2025 [1][10] Group 1: Remodel Strategy - The company has recognized past overinvestment in remodels that did not enhance guest experience, leading to ineffective capital spending [2] - Recent consumer insights have guided the company to focus on remodel elements that directly influence guest experience, aiming for improved outcomes and reduced ineffective spending [2] - Currently, three remodels are under construction, with plans to open six additional remodeled locations in the next five months, indicating an accelerated execution of the remodel strategy [3] Group 2: Strategic Importance - The remodel program is a key strategic lever for the company, with a refined investment approach and a faster rollout timetable, contributing to the Back to Basics strategy [4] - Management views the remodels as essential for strengthening operations and enhancing guest experience, positioning the brand for better performance in the future [4] Group 3: Competitive Landscape - Competitors like Restaurant Brands International Inc. (QSR) and Brinker International, Inc. (EAT) are also focusing on remodel and reimage programs to enhance unit performance and long-term growth [5] - QSR is modernizing the Burger King system, reporting solid post-remodel uplifts and average unit volumes nearing $2 million, with a significant portion of remodels outperforming the broader system [6] - Brinker is implementing a targeted refresh strategy for Chili's and Maggiano's, with new prototypes and foundational approaches to stabilize traffic [7] Group 4: Financial Performance - Dave & Buster's shares have declined 14.4% over the past three months, compared to a 1.4% decline in the industry [8] - The stock trades at a forward price-to-sales ratio of 0.32, significantly below the industry average of 3.23, indicating potential undervaluation [11] - The Zacks Consensus Estimate for fiscal 2026 earnings per share (EPS) suggests an 83% year-over-year decline, with no changes in EPS estimates over the past 30 days [13]

Core Insights - The company is focused on executing its "Back to Basics" plan, aiming to enhance guest experience and operational results, which is expected to create significant value for both guests and shareholders [1][42]. Group 1: Back to Basics Plan - The company has made substantial progress on its "Back to Basics" plan, which includes improvements in marketing, food and beverage offerings, operations, and remodels [2][5]. - Sequential improvement in same-store sales was observed each month during the third quarter, with the final month showing a decline of only approximately 1% [2][18]. - The new menu launch contributed positively to same-store sales for food and beverage during the quarter [2][9]. Group 2: Marketing and Promotions - A reconstructed marketing strategy has been implemented, focusing on a simplified promotional calendar and data-driven decisions to enhance guest acquisition and sales performance [6][7]. - The "Eat & Play" combo promotion has seen a significant increase in guest engagement, with double-digit percentage growth in guest attachment since the beginning of the year [10]. Group 3: Food and Beverage Initiatives - The company has successfully revamped its food and beverage offerings, leading to higher average checks and increased traffic in dining areas [8][9]. - October same-store food sales were reported as the best month of the year, with continued positive trends into November [9][18]. Group 4: Operational Enhancements - Comprehensive training programs have been introduced to empower teams and improve guest experiences, resulting in reduced turnover and enhanced engagement [11][16]. - The company is focused on aligning marketing campaigns with high-impact game launches, with plans to introduce 10 new games in 2026 [12][13]. Group 5: Financial Performance - In the third quarter of fiscal 2025, the company reported revenue of $448 million, a net loss of $42 million, and an adjusted EBITDA of $59 million, resulting in an adjusted EBITDA margin of 13% [18][20]. - The company generated $58 million in operating cash flow during the third quarter, ending with $14 million in cash and $442 million in total liquidity [20][21]. Group 6: Growth and Expansion - The company opened 1 domestic D&B store and 3 new domestic Main Event stores in the third quarter, with plans for 11 new domestic store openings and 1 relocation in fiscal 2025 [22][23]. - International franchising is seen as a driver of efficient growth, with agreements for over 35 additional stores in the coming years [23].

Core Insights - Dave & Buster's Entertainment, Inc. shares increased over 15% intra-day despite reporting third-quarter results that fell short of analyst expectations due to declining comparable-store sales [1] Financial Performance - The company reported an adjusted loss of $1.14 per share for the quarter ending November 4, 2025, which was wider than the expected loss of $1.04 [2] - Revenue for the quarter was $448.2 million, below the consensus estimate of $461.73 million, and represented a 1.1% decline from the same period last year [2] - Comparable-store sales decreased by 4.0% year-over-year [2] Loss and EBITDA - The net loss widened to $42.1 million, or $1.22 per diluted share, compared to a loss of $32.7 million, or $0.84 per share, in the third quarter of fiscal 2024 [3] - Adjusted EBITDA fell to $59.4 million from $68.3 million a year earlier [3] Management Commentary - Management indicated that same-store sales for food and beverages were positive during the quarter and noted sequential monthly improvement, with the final month experiencing a decline of only about 1% [3]

Core Insights - Dave & Buster's Entertainment, Inc. (PLAY) reported mixed third-quarter fiscal 2025 results, with earnings surpassing the Zacks Consensus Estimate but revenues missing the same [1][9]. Financial Performance - The company incurred an adjusted loss per share of $1.14, which was narrower than the Zacks Consensus Estimate of a loss of $1.16, compared to an adjusted loss per share of 45 cents in the year-ago quarter [4]. - Quarterly revenues totaled $448.2 million, missing the consensus mark of $460 million by 2.6%, and decreased 1.1% from $453 million reported in the prior-year quarter [4]. - Food and Beverage revenues, accounting for 37.7% of total revenues, increased 6.6% year over year to $168.8 million, while Entertainment revenues, making up 62.3%, fell 5.2% year over year to $279.4 million [5]. - Comparable store sales declined 4% year over year, but management noted steady monthly improvement, with October comps down only about 1% from the prior year [6]. Operational Highlights - The operating loss for the fiscal third quarter amounted to $16.2 million, compared to operating income of $6.3 million in the year-ago quarter [7]. - Adjusted EBITDA was $59.4 million, down from $68.3 million in the year-earlier quarter, with EBITDA margin declining to 13.3% from 15.1% [7]. Strategic Initiatives - The company remains confident in its Back-to-Basics strategy and targeted initiatives across marketing, games innovation, operations, and remodels, which are beginning to show early signs of progress [2][3]. - Sequential improvements in same-store sales and strong early results from the new menu launch supported better trends through the quarter and into November [3][9]. Balance Sheet and Liquidity - As of November 4, 2025, cash and cash equivalents were $13.6 million, up from $6.9 million as of February 4, 2025 [8]. - Net long-term debt was approximately $1.55 billion, compared to $1.48 billion at the end of fiscal 2024, with available liquidity of $441.9 million [10]. Growth Initiatives - The company opened one domestic Dave & Buster's store and three new Main Event locations during the fiscal third quarter [11]. - Internationally, the company opened its third franchise location in Manila, Philippines, and expects four additional international openings within six months [12].

Core Insights - U.S. stocks exhibited mixed performance, with the Nasdaq Composite declining by over 100 points on Wednesday [1] - Daktronics, Inc. reported quarterly earnings of 35 cents per share, surpassing the analyst consensus estimate of 27 cents per share, and quarterly sales of $229.253 million, exceeding the consensus estimate of $214.077 million [1] Company Performance - Daktronics shares surged by 15.7% to $20.80 following the positive earnings report [2] - Photronics, Inc. saw its shares increase by 44% to $37.00 after reporting better-than-expected fourth-quarter results and issuing optimistic first-quarter guidance [3] - Nextdoor Holdings, Inc. gained 24.6% to $2.5050 after a positive social media mention regarding its valuation [3] - Braze, Inc. rose by 17.5% to $36.00 after raising its FY2026 adjusted EPS and sales guidance [3] - Dave & Buster's Entertainment, Inc. jumped 14% to $20.50 following its third-quarter results [3] - SuperX AI Technology Limited's shares increased by 13.8% to $19.63 [3] - GE Vernova Inc. rose by 11.8% to $699.59 after raising its FY28 outlook and dividend, along with expanding its buyback authorization [3] - DBV Technologies S.A. gained 11.2% to $19.09 [3] - Warby Parker Inc. rose by 11% to $25.77 [3] - Dyne Therapeutics, Inc. increased by 10.5% to $20.38 after announcing a $350 million public offering [3] - ABIVAX Société Anonyme rose by 8.6% to $133.24 [3] - Olema Pharmaceuticals, Inc. gained 8.1% to $28.67 [3] - The Middleby Corporation rose by 6.3% to $137.15 after an upgrade from Jefferies [3] - EchoStar Corporation increased by 5.6% to $98.80 following an upgrade from Morgan Stanley [3]

Core Insights - Dave & Buster's reported revenue of $448.2 million for the quarter ended October 2025, reflecting a year-over-year decline of 1.1% and a surprise of -2.6% compared to the Zacks Consensus Estimate of $460.15 million [1] - The company posted an EPS of -$1.14, which is worse than the -$0.45 reported a year ago, but better than the consensus estimate of -$1.16, resulting in an EPS surprise of +1.72% [1] Financial Performance Metrics - Comparable Store Sales decreased by 4%, which is worse than the average estimate of -3.2% based on five analysts [4] - The total number of stores at the end of the period remained at 241, matching the average estimate [4] - Company-owned stores for Dave & Buster's totaled 177, slightly below the average estimate of 178 [4] - Entertainment revenues were reported at $279.4 million, which is lower than the average estimate of $291.82 million, representing a year-over-year decline of 5.2% [4] - Food and beverage revenues reached $168.8 million, exceeding the average estimate of $168.24 million, with a year-over-year increase of 6.6% [4] Stock Performance - Over the past month, shares of Dave & Buster's have returned +28.8%, significantly outperforming the Zacks S&P 500 composite's +1.9% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Insights - Dave & Buster's reported a quarterly loss of $1.14 per share, slightly better than the Zacks Consensus Estimate of a loss of $1.16, but worse than a loss of $0.45 per share a year ago [1][2] - The company posted revenues of $448.2 million for the quarter, missing the Zacks Consensus Estimate by 2.6% and down from $453 million year-over-year [3] - The stock has underperformed significantly, losing about 39.1% since the beginning of the year compared to the S&P 500's gain of 16.4% [4] Financial Performance - The earnings surprise for the recent quarter was +1.72%, while the previous quarter saw a significant negative surprise of -54.55% [2] - Over the last four quarters, the company has surpassed consensus EPS estimates two times [2] - The current consensus EPS estimate for the upcoming quarter is $0.53 on revenues of $559.64 million, and for the current fiscal year, it is $0.43 on revenues of $2.14 billion [8] Industry Context - Dave & Buster's operates within the Retail - Restaurants industry, which is currently ranked in the bottom 21% of over 250 Zacks industries [9] - The performance of the stock is expected to be influenced by the overall outlook for the industry, as top-ranked industries tend to outperform bottom-ranked ones by a factor of more than 2 to 1 [9] Future Outlook - The estimate revisions trend for Dave & Buster's was unfavorable prior to the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [7] - The upcoming earnings call will be crucial for understanding management's commentary and future earnings expectations [4][5]