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As a result, shares fell 3.5% in premarket trading with analysts attributing weakness to weaker-than-expected comparable sales during the period.
Earnings per share of 94 cents came in line with the analyst consensus. Comparable sales decreased by 6.3%.
Total revenue reached $542.1 million, which was lower than the estimated revenue of $559M. Food and beverage revenue specifically amounted to $181.3M, missing the estimated figure of $189.3M.
“As we enter the second half of 2023, we remain as confident as ever in our ability to execute against the numerous and sizeable growth initiatives that we laid out in our recent investor day presentation and which we have already begun implementing,” said Chris Morris, Dave & Buster’s Chief Executive Officer.
Raymond James analysts downgraded the stock to Outperform from Strong Buy, citing weaker near-term sales. The price target goes down by $5 to $55 per share.
“Sharply negative comps could keep the stock relatively range-bound in the near term, in our view. That said, we continue to see a very positively skewed risk/reward for patient investors,” they wrote in a note.
Jefferies analysts also lowered the price target to $55 on the Buy-rated stock.
“We continue to view the long-term growth opportunity as underappreciated,” they said.
