What To Expect From Dave & Buster's (PLAY) Q1 Earnings

Jabin Bastian /
2024/06/11 3:00 am EDT

Arcade company Dave & Buster’s (NASDAQ:PLAY) will be announcing earnings results tomorrow afternoon. Here's what you need to know.

Dave & Buster's met analysts' revenue expectations last quarter, reporting revenues of $599.1 million, up 6.3% year on year. It was a weak quarter for the company, with a miss of analysts' earnings estimates.

Is Dave & Buster's a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Dave & Buster's revenue to grow 3.4% year on year to $617.6 million, slowing from the 32.4% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.72 per share.

Dave & Buster's Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Dave & Buster's has missed Wall Street's revenue estimates four times over the last two years.

Looking at Dave & Buster's peers in the leisure facilities segment, some have already reported their Q1 results, giving us a hint as to what we can expect. United Parks & Resorts delivered year-on-year revenue growth of 1.4%, beating analysts' expectations by 4.5%, and Topgolf Callaway reported a revenue decline of 2%, falling short of estimates by 1.1%. United Parks & Resorts traded up 9.3% following the results while Topgolf Callaway was down 6.6%.

Read our full analysis of United Parks & Resorts's results here and Topgolf Callaway's results here.

Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 thanks to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and while some of the leisure facilities stocks have fared somewhat better, they have not been spared, with share prices down 2.8% on average over the last month. Dave & Buster's is down 13.2% during the same time and is heading into earnings with an average analyst price target of $73 (compared to the current share price of $48.1).

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