Categories: Invest

Buy/hold Dave & Buster’s as bullish signals emerge after a robust quarter

Dave & Buster’s Entertainment Inc. (NASDAQ:PLAY) gained on Tuesday after its highest ever quarterly revenue. The revenue came at $451.1 million in the first quarter, 24.1% higher than the previous year. The net income also reached a record $67.0 million. 

Heading into the second quarter, Dave & Busters is already posting strong results. The company said that its comparable-store sales have surged by 12.2% in the five weeks of the quarter. The results compare to the previous year. Already, the company gave a glimpse of its second quarter, which is currently underway. 


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Dave & Buster’s is an American entertainment business. It combines entertainment and dining for both adults and families. The economic reopening is good for the company’s trajectory as people dine out more. However, comes the inflation question. The entertainment company said that it had withered the cost pressures successfully. It cited its more efficient labor model, cost savings, and thoughtful pricing actions. The quarter results were a testament to the cost initiatives.

PLAY technical analysis shows a bullish momentum building

Source – TradingView

Technically, a bullish pin bar emerged at the $38 support after the quarterly earnings. The pin bar is taking the price higher. We project the next level that the stock will hit will be $42. However, further gains are expected in line with the momentum and strong fundamentals. We believe investors should buy the stock now and hold up to $46.50 resistance or higher.

Summary

PLAY is a buy at the current level as bullish signals and strong momentum emerge. Investors can hold the stock up to $46.50. The stock will face some resistance at $42.10, but we see it rising past the level.

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