Dave & Buster’s (PLAY) 2020 Q4 Report in Focus

Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) has an interesting history. Back in the 1970s, James Buster Corley started a restaurant and around the same time, Dave Corriveau was operating a place for entertainment and games. In 1982, Corley and Dave met each other and came up with the idea of opening first Dave Buster’s. Since then, the company has been offering high-quality food and beverage as well as sports and other entertainment under one roof.

However, Dave & Buster’s stock experienced sharp declines during the last year following the Covid-19 pandemic. The company had to close its locations during the peak of the health crisis. As a result, its share price fell around 25 percent during 2020.

The negative impact of the pandemic also reflected in the company’s recently released Q4 results. Dave & Buster’s reported a loss of $56.8 million, or $1.19 per share for the three months ended January 31, as compared to earnings of $25 million, or 80 cents per share in the comparable period of 2019. Analysts on average were looking for a loss of $1.25 per share.

Revenue for the quarter fell 66.3 percent to $116.8 million but surpassed the consensus forecast of $101.7 million. Same-store sales declined 70 percent in the quarter.

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Offering a performance overview for Q1, CEO Brian Jenkins said in a statement, “During the first eight weeks of the first quarter, sales at our fully operational comp stores achieved 74% of 2019 levels with total sales of approximately $150 million, representing our strongest performance since COVID started. We achieved our second consecutive month of positive enterprise-level EBITDA in the month of February, the first full month of fiscal 2021, and expect to generate enterprise-level EBITDA profitability for the first quarter, a significant milestone in our ongoing business recovery.”

Dave & Buster’s also issued its sales outlook for Q1. It expects to report revenue in the range of $210 million to $220 million for the current quarter.

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