Dave & Buster'S Entertainment increases 1.5% on average volume 10 July 2019

NEWS BITES - NORTH AMERICA

Dave & Buster'S Entertainment, Inc. (NASDAQ:PLAY) has increased 58.0c (1.5%) from its previous trading session to close at $US39.63. Compared with the NASDAQ-100 Index which rose 76.5 points (1%) in the day, the relative price increase was 0.5%. The volume of 1 million shares was close to average trading. There were 1,048,100 shares worth $US41.5 million traded today.

Stock Summary

Today's close (USD)39.63
52-Week Range (USD)38.8-66.6
SectorTotal Nasdaq Market
Shares Outstanding36,367,000
Market Cap$US1.4 billion

Highlights in today's Report:

SECTION 1 TODAY'S BULLISH SIGNALS

SECTION 2 TODAY'S BEARISH SIGNALS

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF $US39.63):

SECTION 3 THE PAST WEEK

SECTION 4 ONGOING BULLISH PARAMETERS

SECTION 5 ONGOING BEARISH PARAMETERS

SECTION 6 REPORTED BUYING AND SELLING

SECTION 7 SUMMARY FINANCIALS

SECTION 8 CORPORATE PROFILE

SECTION 1 DAVE & BUSTER'S ENTERTAINMENT BULLISH SIGNALS

1.1 Undervaluation [compared with sector average]:

Earnings Yield

+ Earnings yield of 7.6% is 3.6 times the 10-year bond yield of 2.08%.

Dividend Yield

+ To quote Benjamin Graham: "A dividend yield of at least two-thirds the triple-A bond yield"; the stock's dividend yield is 0.7 times the triple-A bond yield of 2.1%.

+ The relative yield of PLAY, defined by its yield of 1.5%, divided by average yield of dividend yielding stocks in the NASDAQ-100 Index of 0.9% is 158.9%. This suggests Dave & Buster'S Entertainment stock is undervalued in dividend yield terms.

MCap/Total Assets

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 1.1. Compared with the rest of the market the stock is undervalued.

1.2 Uptrend:

+ Rising open interest with rising price

+ Open interest hit a two-month high.

+ Open Interest Trend

Same day trend: The price increased 1.5% from $US39.05 to $US39.63; Open interest has soared 10.8% from 7,955 to 8,810. A price rise combined with an increase in open interest suggests there is new money coming into the market from existing or new buyers. This is a bullish signal.

DurationOpen Interest change %Price change %Interpretation
1-day10.81.5Strong Market
1-week15.40.6Strong Trend

Past Week:

+ Dave & Buster'S Entertainment, Inc. is placed 865/2470 in BuySellSignals' ranking of NASDAQ performers in the past week, a percentile ranking of 65.

+ In the past week, volume was 1.0 times average and the shares were up 0.6%.

1.3 High Price Performance Indicator and rank of Dave & Buster'S Entertainment in the NASDAQ market:

DescriptionPLAY ValueRank In Market
Today's Trading Turnover$US41.5 millionIn Top Quartile

SECTION 2 DAVE & BUSTER'S ENTERTAINMENT BEARISH SIGNALS

2.1 Overvaluation Indicators and rank of Dave & Buster'S Entertainment in the NASDAQ market:

DescriptionValueRank In Market
Price/Earnings/Growth5.5In Bottom 1%
* EV/EBITDA6.9In Bottom Quartile

* Enterprise value of $US1.8 billion is divided by Earnings before interest tax depreciation and amortization of $US266.2 million.

2.2 Downtrend:

+ Increasing Put Call Ratio

+ Put Call Contracts

The Put/Call ratio has jumped from 0.875 to 0.981 suggesting a downtrend.

Put ContractsCall ContractsPut/Call ratio
Today4,3624,4480.981
Previous day3,7124,2430.875

Price/Moving Average Price and MACD:

+ The Price/MAP of 0.76 for PLAY is lower than the Price/MAP for the NASDAQ-100 Index of 1.12.

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 40.13 minus the 26-day EMA of 42.45 is negative suggesting a bearish signal. Both the 12-day EMA as well as the 26-day EMA are falling, another bearish signal.

+ The price to 50-day EMAP ratio is 0.9, a bearish indicator. In the past 200 days this ratio has been under 0.9 17 times suggesting further downside. The 50-day EMAP has decreased to $US45.53. A decrease is another bearish indicator.

+ The price to 200-day MAP ratio is 0.76, a bearish indicator. In the past 200 days this ratio has been under 0.76, 12 times suggesting further downside. The stock is trading below both its MAPs and the 50-day MAP of $US48.37 is lower than the 200-day MAP of $US51.85, a bearish indicator. The 200-day MAP has decreased to $US51.85. A decrease is another bearish indicator.

Past Month:

+ In the past three months the stock has hit a new 52-week low four times, pointing to a downtrend.

Slipping Relative Strength (1mo, 3 mo):

+ In the NASDAQ market of 2,450 stocks and 11 units traded today, the stock has a 6-month relative strength of 18 indicating it is trailing 82.0% of the market.

+ Also, the relative strength percentile is slipping at 18 for 3 months and 4 for 1 month.

2.3 Low Price Performance Indicators and rank of Dave & Buster'S Entertainment in the NASDAQ market:

DescriptionPLAY ValueRank In Market
Price/MAP500.82In Bottom Quartile
Price/MAP2000.76In Bottom Quartile

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF $US39.63):

SECTION 3 THE PAST WEEK

3.1 Snapshot: Dave & Buster'S Entertainment stock was up 25.0c or 0.6% in the past week. Volume in the week was 1.1 times average trading of 4.1 million shares. It underperformed the NASDAQ-100 index in 4 out of 5 days.

DayDave & Buster'S EntertainmentClose price [USD]Price change %Relative change %Comment
TuesdayDrops 2.7% weakening below moving average price39.05-2.7-3.2Steepest Fall; VI*=1.3
MondayDecreases 1.1% on average volume40.13-1.1-0.4Price fall on falling relative strength
FridayRises 3.0% with rising open interest40.583.03.3Top Rise
WednesdayPut call ratio increases 21.8%, stock decreases39.380.2-0.6Price fall on falling relative strength
TuesdayUnderperforms 98% of the market39.31-1.8-2.2VI*=1.5

[Volume Index (VI); 1 is average]

3.2 Volatility:

+ Dave & Buster'S Entertainment is at a discount of 40.5% to its 12-month high of $US66.61 on October 01, 2018. It is also at a premium of 2.2% to the 12-month low of $US38.76 on June 19, 2019.

SECTION 4 ONGOING BULLISH PARAMETERS

4.1 Performance:

+ Return on Equity 30.2% [14.5%].

+ Return on Assets 9.2% [3.9%].

+ Return on Capital Employed 14.4% [5.0%].

+ As per the Du Pont analysis, Return on Equity [ROE] is high at 30.2%; an improvement from 28.7% last year. ROE is computed as net profit margin of 9.3% times asset turnover [sales/assets] of 0.99 times leverage factor [total assets/shareholders' equity] of 3.3.

YOY Improvement in ROE and Profit Margin

Du Pont AnalysisROEProfit MarginAsset TurnoverEquity Multiplier
Current Year30.29.30.993.3
Previous Year28.710.60.952.8

4.2 Growth:

Quarterly Trend in Revenue, Net Profit and Net Profit Margin:

+ Net Profit margin is positive and has seen consecutive rises in recent quarters. [All figures in %]

Qtr-endedRevenue GrowthNet Profit GrowthNet Profit Margin
May 19 [Q1]9.634.911.7
Feb 19 [Q4]17.6148.38.9
Nov 18 [Q3]--4.2

4.3 Low Debt Indicators:

+ Total Liabilities/EBITDA of 3.3 is comfortably below the Joseph Piotroski benchmark of 5.

4.4 High Performance Indicators and rank of Dave & Buster'S Entertainment in the NASDAQ market:

DescriptionValueRank In Market
Return on Equity [ROE] %30.2In Top 7%
Return on Assets [ROA] %9.2In Top Quartile

4.5 Increased ADVT past five years

Avg. Daily Volume Traded 12 months ended Jul 10, million shares

YearADVT
20191.0
20181.2
20170.79
20160.63
20150.31

In the past five years, Average Daily Volume of Trading (ADVT) has increased 224.6% to 1 million shares.

4.6 Increased VWAP

Past five years, 12 months ended Jul 10 (USD)

YearHigh PriceVWAPLow Price
201966.6150.5838.76
201867.3348.5737.51
201772.8352.637.26
201648.3639.5129.28
201537.8231.0716.85

In the past five years Volume Weighted Average Price (VWAP) has increased by 62.8% to $US50.58.

4.7 Increased Average Daily Turnover

Past five years, 12 months ended Jul 10 (USD million)

YearAverage Daily Turnover
201951.2
201858.8
201741.8
201625.1
20157.1

In the past five years, average daily share turnover has increased 621.3% to $US51.2 million. This suggests increased liquidity.

SECTION 5 ONGOING BEARISH PARAMETERS

5.1 High Debt Indicators:

+ The debt to equity ratio of 101.5% is above a safe benchmark figure of 70%. Moreover, it has deteriorated in the past two years.

DescriptionValueRank In Market
Debt to Equity1.0In Bottom Quartile

5.2 Low Growth and Performance Indicator and rank of Dave & Buster'S Entertainment in the NASDAQ market:

DescriptionValueRank In Market
EPS Growth %2.4In Bottom 1%

5.3 Moving Annual Return (Past 3 years)

Based on a dynamic start date of 3 years ago, the real rate of return has averaged -1.8%. The Moving Annual Return has been positive in 1 out of 3 years.

PLAYClose (USD)Dividends (USD)Capital Gain / (Loss) %% YieldAnnual Return %
Jul 1039.630.6(17.8)1.2(16.6)
1 Yr ago48.23-(25.0)-(25.0)
2 Yrs ago64.32-36.1-36.1

Close 3 years ago $US47.27

5.4 Increase in Insider Selling

In the past 5 years a total of 3,633,229 Dave & Buster'S Entertainment shares (or 10.0% of the total shares on issue) worth $US143.3 million were sold by insiders. Based on a dynamic start date of 5 years ago, insider selling has averaged 726,646 shares per year. In the past year, insiders sold 258,735 shares, an increase of 49.1% from the previous year.

SECTION 6 DAVE & BUSTER'S ENTERTAINMENT REPORTED BUYING AND SELLING

6.1 Institutional Buying and Selling Quarter Ended March 31

Total reported Institutional buying = 3,206,735 shares

Total reported Institutional selling = 3,568,147 shares

Net reported institutional selling = 361,412 shares

6.2 Reported Holdings of Institutions as at Mar 31, 2019

Total = 35,729,986 shares

Market Value = $US1.8 billion

SECTION 7 DAVE & BUSTER'S ENTERTAINMENT SUMMARY FINANCIALS

7.1 Dividend History

+ Trailing 12 months dividend for the 12 months ended July 10 was unchanged at 60.0c.

7.2 Financials Summary

Year endedFeb 2019Feb 2018Jan 2017
Sales (USD B)1.31.11
Pretax (USD M)147.9156.4143.5
Net (USD M)116.8121.491
EPS (USD)32.932.16

+ Net profit was down 3.8% from US$121.4 million in 2018 to US$116.8 million in 2019.

+ Earnings Per Share (EPS) was up 2.4% from $US2.93 to $US3.0.

7.3 Quarterly Report: Key Parameters

Quarterly Report Q1 2019: Dave & Buster'S Entertainment reports 34.9% sequential rise in Quarterly Net Profit

Dave & Buster'S Entertainment (NASDAQ:PLAY), announced net profit of $US39.7m for the quarter-ended 05 May 2019, up 34.9% from the previous quarter and down 5.2% from the year-earlier period.

Quarter-ended05 May [Q1/2019]03 Feb [Q4/2018]04 Nov [Q3/2018]
EPS$US1.1577.0c30.0c
Sequential growth in EPS %49.35156.67-
Revenue$US364m$US332m$US282m
Sequential growth in Revenue %9.5817.6-
Net Profit$US39.7m$US29.4m$US11.9m
Sequential growth in Net Profit %34.93148.28-

Compared with the previous corresponding period [PCP; Q1/2018], year-over-year [y.o.y.] EPS was up 8.5%, Revenue was up 9.5% and Net Profit was down 5.2%.

Quarter-ended05 May [Q1/2019]06 May [Q1/2018]
EPS$US1.15$US1.06
PCP growth in EPS %8.493.92
Revenue$US364m$US332m
PCP growth in Revenue %9.459.22
Net Profit$US39.7m$US41.9m
PCP growth in Net Profit %-5.16-1.47

7.4 Annual Report: Key Parameters

FY2019 Annual Report: Dave & Buster'S Entertainment EPS Growth slows to 2.4%

Dave & Buster'S Entertainment (NASDAQ:PLAY), announced EPS of $US3.0 for the year-ended 03 February 2019, up 2.4% from $US2.93 in the previous year-ended 04 February 2018. EPS growth from the year-ended 29 January 2017 to the year-ended 04 February 2018 was 35.6%.

Period-endedEPS in $USEPS growth %
03 February 20193.02.4
04 February 20182.9335.6

Major changes compared with previous year:

Favourable Changes:

- Total revenue up 11% from $US1.1b to $US1.3b

- EPS up 2.4% from $US2.93 to $US3.0

- Administration expenses to Revenues down from 5.2% to 4.9%

- Retained earnings to total assets up from 20.7% to 27.8%

- Fixed Assets to Total Assets up from 60.7% to 63.3%

- Total Liabilities to EBITDA of 3.3 compares favourably with the Joseph Piotroski benchmark of <5. However, it has deteriorated by 11.4% from the previous year's ratio of 3.0.

- Total Liabilities to Operating Cash Flow of 2.6 compares favourably with the Joseph Piotroski benchmark of <4. This ratio has improved by 10.6% from the previous year's ratio of 2.9.

Unfavourable Changes:

- Net profit down 3.8% from $US121.4m to $US116.8m

- EBIT Margin down from 13.7% to 11.7%

- EBIT to total assets down from 13.1% to 11.6%

- Profit before tax to Revenues down from 13.7% to 11.7%

- Debt to Equity up 16.1% from 0.9 to 1.0

- Current ratio down 19.6% from 0.5 to 0.4

- Total current assets to Total Assets down from 7.9% to 7.2%

Note:

- Total revenue to total assets steady at 1.0

- Cost of Goods Sold to Revenues up from 17.3% to 17.4%

- Depreciation to Revenues up from 9% to 9.3%

- Tax expenses to Revenues down from 3.1% to 2.4%

- Total liabilities to Total assets steady at 0.7

- Total non-current assets to Total Assets up from 92.1% to 92.8%

- Intangibles to Total Assets down from 29.4% to 27.6%

- Current Inventory to Total Assets down from 2.3% to 2.1%

Annual Report [Year-on-year comparison: 2019 vs 2018]

Company Name : Dave & Buster'S Entertainment, Inc. (PLAY)
February 0320192018Change
Description$US m$US m(%)
Total Revenue1,265.31,139.8Up 11
EBITDA266.2259.2Up 2.7
Depreciation118.3102.8Up 15.1
EBIT147.9156.4Down 5.4
Pre-Tax Profit/(Loss)147.9156.4Down 5.4
Profit/(Loss) after Tax116.8121.4Down 3.8
Working Capital(153.3)(112.9)Deterioration 35.8
Current Assets91.194.9Down 4
Current Liabilities244.4207.8Up 17.6
Shareholders' Funds387.8421.6Down 8
Total Liabilities885.4775.4Up 14.2
Total Assets1,273.21,197Up 6.4
Non-Current Debt378.5351.2Up 7.7
Total Debt393.5366.2Up 7.4
Operating Cash Flow337.6264.7Up 27.6
Net Assets387.8421.6Down 8
Net Tangible Assets36.270.1Down 48.3
AuditorKPMG LLP 

Year-on-year comparison of Per Share figures

February 0320192018Change (%)
Description$US $US
EBITDA6.86.3Up 8.6
Cash54c44.1 cUp 22.3
Shareholders' Funds9.910.2Down 2.8
Total Liabilities22.718.8Up 20.7
Total Assets32.629Up 12.4
Non-Current Debt9.78.5Up 13.9
Total Debt10.18.9Up 13.6
EPS Final32.9Up 2.4

Year-on-year comparison of Performance Ratios

February 0320192018Change (%)
Return on Equity (%)30.228.7Up 5.2
Return on Assets (%)9.210.1Down 8.9
Total Liabilities to EBITDA3.33Up 11.4
Total Liabilities to Operating Cash Flow2.62.9Down 10.6
Total Liabilities/Total Assets (Up 7.7% from 0.65 to 0.7)0.70.7Up 7.7
Current Ratio0.40.5Down 19.6
Common Size Ratios by Assets %
Total non-current assets to Total Assets 92.8 92.1 Up 0.8
Fixed Assets to Total Assets 63.3 60.7 Up 4.3
Intangibles to Total Assets 27.6 29.4 Down 6.0
Total current assets to Total Assets 7.2 7.9 Down 9.2
Current Inventory to Total Assets 2.1 2.3 Down 8.8
Common Size Ratios by Revenues %
Cost of Goods Sold to Revenues 17.4 17.3 Up 0.8
Profit before tax to Revenues 11.7 13.7 Down 14.7
Depreciation to Revenues 9.3 9.0 Up 3.1
Administration expenses to Revenues 4.9 5.2 Down 6.2
Tax expenses to Revenues 2.4 3.1 Down 22.8

Five-year record of growth and performance:

In the last 5 years Total Revenue averaged $US1,004.8M, EBITDA averaged $US202M and Net Profit averaged $US79.2M. Compound Annual Growth Rate (CAGR) averaged 14.8% for Total Revenue, 121.9% for Net Profit and 17.8% for EBITDA.

DescriptionAnnual ($US M)5-year Avg ($US M)5-year CAGR %
Total Revenue1,265.31,004.814.8
EBITDA266.220217.8
Operating Profit147.9110.223.7
Net Profit116.879.2121.9

Five-year record of EBITDA, Operating Profit and ROCE

In 2019 Operating Profit Margin of 11.7% was above its 5-year Avg of 10.4% (All Figures in %)

Description20195-year Avg
EBITDA Margin2119.5
Operating Profit Margin11.710.4
Return on Capital Employed14.411.8

SECTION 8 CORPORATE PROFILE

8.1 Activities

Dave & Buster'S Entertainment, Inc is a leading owner and operator of high-volume venues in North America that combine dining and entertainment for both adults and families.

8.2 Top Management

The chief executive officer is Stephen M. King and the chief financial officer is Scott J. Bowman.

8.3 Issued Capital and MCap

Based on 36,367,000 issued shares the market capitalisation is $US1.4 billion.

8.4 Vanguard Total World Stock ETF 7489:

The stock was one of 7489 global stocks selected by Vanguard Total World Stock ETF (VT). As at May 31, 2019, the Vanguard Total World Stock ETF held 12,000 shares worth $US664,372 by value of the ETF's portfolio [Ranked 2930 out of 7489 by value and 417 out of 676 for NASDAQ].

COMPANY IDENTIFIERS

Contact: +1 214 357-9588

Physical Address: 2481 Ma ana Drive, Dallas, TX,75220

State/Province/Country: TX, United States

Country of Incorporation: United States

Industry [NAICS]: 722511

Exchange: NASDAQ

ISIN: US2383371091

O:PLAY; PLAY.O

PermID: 5035420598

RIC: PLAY.O

CIK: 1525769

CUSIP: 238337109

Dave & Buster' Entertainment Inc, Dave & Buster' Entertainment, Inc, Dave & Buster'S Entertainment Inc, Dave & Buster'S Entertainment, Inc

Source: www.BuySellSignals.com