One-glance verdict
Overvalued
$-20.59 our estimate vs market $8.06
Wall Street consensus: $13.00 (-163.1% lower than our fair-value estimate)
139% below our estimate, beyond the bull case
Fundamentals snapshot
Dave & Buster's Entertainment, Inc.
PLAY · NMS · Communication Services · Entertainment
Current price
$8.06
52-week range
$6.26 - $22.10
Market cap
$280.74M
Balance sheet
Distressed
0.72x Concerning
Net debt $3.57B. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
3 Risks
1 rewards · 3 risks
- Reward Free cash flow was positive in 8/10 years.
- Risk Return on equity was -69.7% last year — the company lost money on shareholders' equity.
- Risk Net debt grew 17.4% over 3 years.
- Risk Operating margin compressed from 14.1% to 4.4% over 3 years.
What this company does
Dave & Buster's Entertainment, Inc.
Dave & Buster's is like a big arcade combined with a restaurant, selling food, drinks, and a fun experience with games and sports viewing. Most of their money (revenue) comes from people buying these food, drink, and game packages, and understanding how much profit they keep from each sale, called their operating margin (the percent of each sales dollar left after day-to-day business costs), helps show how well they are managing their expenses. This business model matters because it means they can attract customers with both food and entertainment, potentially leading to repeat visits and steady sales.
How the company got here
The story of Dave & Buster's began in the late 1970s in Little Rock, Arkansas, with two entrepreneurs, David Corriveau and James "Buster" Corley. Corriveau owned an entertainment and game venue, while Corley ran a restaurant next door. They noticed customers often moved between their establishments, leading them to combine their concepts into the first Dave & Buster's in Dallas, Texas, in 1982. This innovative "eatertainment" model, blending dining with arcade games and sports viewing, proved successful. Over the years, the company expanded, went public, and eventually acquired the Main Event brand in 2022, broadening its reach into family-oriented entertainment.
What it actually does
Dave & Buster's Entertainment, Inc. operates large entertainment and dining venues across North America. These venues are designed as destinations where people can eat, drink, play games, and watch live sports or other televised events. The company aims to provide a comprehensive social experience that customers can't easily replicate at home.
Dave & Buster's
This is the company's flagship brand, targeting a more adult-social and arcade-focused customer. Dave & Buster's venues offer a full-service restaurant with a diverse menu, a bar with a wide selection of drinks, and a large arcade area known as the "Million Dollar Midway" filled with various games and attractions. This segment is a significant contributor to the company's revenue, with entertainment spending (from games and attractions) being a key driver of its business model.
Main Event
Acquired by Dave & Buster's in 2022, Main Event is a distinct brand that caters more to families and focuses on activities like bowling and laser tag, alongside arcade games. While it also offers food and beverages, its emphasis is on family-oriented fun and events like birthday parties. This brand broadens the company's appeal and customer base, complementing the Dave & Buster's offering.
What management is betting on now
Management is focused on driving long-term value by growing the business and improving profitability. This includes investing in new games and innovative experiences to keep the arcade offerings fresh and exciting, as well as revamping food and beverage menus to enhance the dining aspect. The company is also strategically expanding its store footprint and remodeling existing locations to optimize the customer experience and ensure continued growth across both its Dave & Buster's and Main Event brands.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q3
$-138.40M
FY2025 Q4
$-61.00M
FY2026 Q1
$-58.80M
FY2026 Q2
$-55.20M
FY2026 Q3
$-20.60M
FY2026 Q4
$34.00M
FY2027 Q1
$8.50M
FY2027 Q2
$-37.90M
Revenue
$544.10M
Net income
$-12.50M
Diluted EPS
-0.36
Operating cash flow
$46.80M
Free cash flow
$-37.90M
Fetching…
Sources
Revenue
$559.20M
Net income
$5.70M
Diluted EPS
0.16
Operating cash flow
$113.80M
Free cash flow
$8.50M
Fetching…
Sources
Revenue
$529.50M
Net income
$-39.70M
Diluted EPS
-1.12
Operating cash flow
$103.00M
Free cash flow
$34.00M
Fetching…
Sources
Revenue
$448.20M
Net income
$-42.10M
Diluted EPS
-1.22
Operating cash flow
$58.00M
Free cash flow
$-20.60M
Fetching…
Sources
Revenue
$557.40M
Net income
$11.40M
Diluted EPS
0.32
Operating cash flow
$34.00M
Free cash flow
$-55.20M
Fetching…
Sources
Revenue
$567.70M
Net income
$21.70M
Diluted EPS
0.62
Operating cash flow
$95.80M
Free cash flow
$-58.80M
Fetching…
Sources
Revenue
$534.50M
Net income
$9.30M
Diluted EPS
0.32
Operating cash flow
$108.90M
Free cash flow
$-61.00M
Fetching…
Sources
Revenue
$453.00M
Net income
$-32.70M
Diluted EPS
-0.84
Operating cash flow
$-7.20M
Free cash flow
$-138.40M
Fetching…
Sources
Is it cheap or expensive?
Fair value $-20.59 vs current price $8.06
Wall Street consensus is the average analyst price target: $13.00 (-163.1% lower than our fair-value estimate).
Our most-likely fair value is $-20.59 a share — about 355.5% below today's price of $8.06, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Distressed
Net debt $3.6B. Interest coverage 0.7x.
Net debt
$3.57B
Interest coverage
0.72x
Dave & Buster's Entertainment, Inc.'s profit covers its interest bill about 0.7 times over. which is stronger than most peers shown here and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
PLAY
BASELINE
Dave & Buster's Entertainment, Inc.
Total debt $3.59B Interest coverage 0.72x This is the baseline the peer rows are being compared against.
Total debt $5.06B Interest coverage 0.51x -29% vs PLAY Carries about 1.4x less debt cushion than PLAY.
Total debt $502.38M Interest coverage 0.51x -29% vs PLAY Carries about 1.4x less debt cushion than PLAY.
Total debt $1.97B Interest coverage 2.44x +238% vs PLAY Carries about 3.4x more debt cushion than PLAY.
What you should know
The case for and against PLAY
1 Reward
3 Risks
Rewards
-
Free cash flow was positive in 8/10 years.
Risks
-
Return on equity was -69.7% last year — the company lost money on shareholders' equity.
-
Net debt grew 17.4% over 3 years.
-
Operating margin compressed from 14.1% to 4.4% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-5.81x
P/B
3.20x
P/S
0.13x
EV/EBITDA
10.39x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
38.3%
Operating margin
4.4%
Net margin
-4.3%
ROE
-69.7%
ROA
1.1%
Health
Liquidity and balance-sheet strength
Debt / equity
40.80x
Current ratio
0.30x
Quick ratio
0.15x
Total debt
$3.59B
Total cash
$16.00M
Growth
How the business has been compounding
Revenue TTM
$2.08B
Revenue 5Y CAGR
106.0%
EPS TTM
-2.56
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$321.60M
Free CF TTM
$-100.60M
FCF margin
-4.8%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2020-01-09