At US$40.01, Is Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY) Worth Looking At Closely?
While Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY) might not be the most widely known stock at the moment, it received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Dave & Buster's Entertainment’s outlook and valuation to see if the opportunity still exists.
View our latest analysis for Dave & Buster's Entertainment
Is Dave & Buster's Entertainment Still Cheap?
Great news for investors – Dave & Buster's Entertainment is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $65.89, but it is currently trading at US$40.01 on the share market, meaning that there is still an opportunity to buy now. However, given that Dave & Buster's Entertainment’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What kind of growth will Dave & Buster's Entertainment generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Dave & Buster's Entertainment's earnings over the next few years are expected to increase by 37%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? Since PLAY is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on PLAY for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy PLAY. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.
If you want to dive deeper into Dave & Buster's Entertainment, you'd also look into what risks it is currently facing. While conducting our analysis, we found that Dave & Buster's Entertainment has 1 warning sign and it would be unwise to ignore this.
If you are no longer interested in Dave & Buster's Entertainment, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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