Dave & Buster's Entertainment Sees Unusually High Options Volume (NASDAQ:PLAY)

Key Points

• Options activity increased: Investors bought 5,009 call options in Dave & Buster’s Entertainment, about 37% above the average volume of 3,653 contracts.
• Analyst sentiment remains cautious: The stock carries a consensus “Hold” rating with an average price target of $17.33, while recent coverage included a downgrade to “Strong Sell” and a reduced target from BMO Capital Markets.
• PLAY remains financially pressured: Shares closed at $7.76, near their one-year low, after the company reported a quarterly EPS loss of $0.27 versus expectations for $0.19 in earnings; revenue also declined 2.4% year over year.

Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY - Get Free Report) was the target of some unusual options trading activity on Friday. Investors bought 5,009 call options on the company. This represents an increase of approximately 37% compared to the average volume of 3,653 call options.

Wall Street Analyst Weigh In

PLAY has been the topic of a number of analyst reports. Zacks Research downgraded shares of Dave & Buster's Entertainment from a "hold" rating to a "strong sell" rating in a research note on Monday, September 28th. Citizens Jmp initiated coverage on shares of Dave & Buster's Entertainment in a research note on Monday, June 29th. They issued a "market perform" rating on the stock. Citigroup restated a "market perform" rating on shares of Dave & Buster's Entertainment in a research report on Tuesday, September 15th. BMO Capital Markets cut their target price on Dave & Buster's Entertainment from $22.00 to $13.00 and set an "outperform" rating for the company in a research note on Tuesday, September 15th. Finally, Weiss Ratings reaffirmed a "sell (d)" rating on shares of Dave & Buster's Entertainment in a report on Thursday. Two investment analysts have rated the stock with a Buy rating, five have given a Hold rating and two have given a Sell rating to the company. According to MarketBeat, Dave & Buster's Entertainment currently has an average rating of "Hold" and an average target price of $17.33.

Insider Activity at Dave & Buster's Entertainment

In other news, Director Nathaniel Lipman bought 12,000 shares of the stock in a transaction dated Thursday, September 17th. The shares were bought at an average price of $6.78 per share, for a total transaction of $81,360.00. Following the completion of the purchase, the director owned 30,715 shares in the company, valued at approximately $208,247.70. This trade represents a 64.12% increase in their ownership of the stock. The acquisition was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CFO Cory Hatton acquired 4,000 shares of the stock in a transaction on Monday, September 28th. The shares were purchased at an average price of $6.50 per share, for a total transaction of $26,000.00. Following the transaction, the chief financial officer directly owned 104,475 shares in the company, valued at approximately $679,087.50. This trade represents a 3.98% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. 1.73% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors have recently modified their holdings of the stock. Tidal Investments LLC bought a new position in shares of Dave & Buster's Entertainment in the 2nd quarter valued at $182,000. Engineers Gate Manager LP raised its position in Dave & Buster's Entertainment by 200.7% in the second quarter. Engineers Gate Manager LP now owns 537,254 shares of the restaurant operator's stock valued at $6,125,000 after purchasing an additional 358,588 shares during the last quarter. Squarepoint Ops LLC raised its position in Dave & Buster's Entertainment by 289.7% in the second quarter. Squarepoint Ops LLC now owns 131,168 shares of the restaurant operator's stock valued at $1,495,000 after purchasing an additional 97,507 shares during the last quarter. Headlands Technologies LLC acquired a new stake in shares of Dave & Buster's Entertainment during the second quarter valued at about $141,000. Finally, Hsbc Holdings PLC acquired a new stake in shares of Dave & Buster's Entertainment during the second quarter valued at about $353,000. 91.45% of the stock is currently owned by institutional investors and hedge funds.

Dave & Buster's Entertainment Price Performance

Shares of PLAY stock traded down $0.20 on Friday, reaching $7.76. The company had a trading volume of 1,106,434 shares, compared to its average volume of 1,757,458. The business's 50-day moving average is $8.24 and its 200 day moving average is $10.33. Dave & Buster's Entertainment has a one year low of $6.26 and a one year high of $22.10. The company has a quick ratio of 0.21, a current ratio of 0.30 and a debt-to-equity ratio of 17.07. The stock has a market capitalization of $270.21 million, a PE ratio of -3.02 and a beta of 1.92.

Dave & Buster's Entertainment (NASDAQ:PLAY - Get Free Report) last announced its quarterly earnings results on Monday, September 14th. The restaurant operator reported ($0.27) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.19 by ($0.46). The company had revenue of $544.10 million for the quarter, compared to the consensus estimate of $556.83 million. Dave & Buster's Entertainment had a negative net margin of 4.26% and a negative return on equity of 51.87%. The company's revenue for the quarter was down 2.4% compared to the same quarter last year. During the same period last year, the firm posted $0.32 earnings per share. Equities research analysts forecast that Dave & Buster's Entertainment will post -1.58 EPS for the current fiscal year.

About Dave & Buster's Entertainment

Dave & Buster's Entertainment, Inc is an entertainment and dining company that operates venues combining arcade games, interactive attractions, sports viewing and casual food and beverage service. Its venues are designed for group entertainment, including family outings, birthday celebrations, corporate events and other social gatherings.

The company operates under the Dave & Buster's and Main Event brands. Dave & Buster's locations generally feature a large arcade with games that award redeemable prizes, along with sports bars, restaurant service and event spaces.

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