Fundamental Analysis
THE STORY OF DAVE & BUSTER
(YES, THEY’RE REAL GUYS!)
Back in the late 1970s, Buster opened a restaurant known for its tasty food and friendly service. A few doors down, Dave opened an outrageous place for entertainment and games where adults were irresistibly drawn for fun. The two young entrepreneurs noticed people rotating between their establishments, and an idea started to form:
WHAT IF THEY PUT BOTH UNDER ONE ROOF?
Reasons to buy – Dave & Buster’s Entertainment
High level decisions on buy or sell for a stock should be driven by
1. The margin that the company makes. i.e. Out of $1 that the company sells how much does the company taken home.
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- Here we see Dave & Buster’s Entertainment makes a margin of 14.5% on Gross Level and about 10.7% on Net level. This means that out of $1 that it makes $0.1 is being pocketed as profits.
2. The growth rates of the company on revenue, net income, EPS and Dividend. i.e. If it sold $1 last year how much more did it sell this year.
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- Here we see net revenue growth of 13% in the revenue and the net profit figures grew by 33%. Notice the Net Margin has improved significantly.
3. The efficiency ratios of the company on Equity and Assets. i.e. How well is the company able to sweat each $1 that it puts to work in the company.
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- Here we see Dave & Buster’s Entertainment makes a Return on Assets of 10.14% and Return of Equity of 28.8% which is pretty good.
GOLD STANDARD : This is one of the no-debate stocks that are a must have in ones portfolio.
All these ratios can be found in the attached excel sheets and are based on the EDGAR report submitted by Dave & Buster’s Entertainment to the SEC. All the data on the above analysis can be found at the link below
Balance Sheet
Income Statement
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