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Omar Venerio
Omar Venerio
Articles (1560) 

Wall Street Edges Higher Wednesday

Dave & Buster's Entertainment declines after reporting earnings

U.S. stocks were in the green on Wednesday after China announced it will be suspending additional tariffs on some U.S. products. The Dow Jones Industrial Average gained 0.50% to 27,045, the S&P 500 Index rose 0.49% to 2,993 and the Nasdaq Composite Index swelled 0.81% to 8,149.

Shares of Dave & Buster's Entertainment Inc. (NASDAQ:PLAY) fell more than 5% after announcing second-quarter results. The company posted earnings of 90 cents per share on revenue of $344.59 million. The company beat earnings estimates by 6 cents, but revenue was in line with expectations.

“We continue to deliver strong revenue and earnings per share growth – including record second quarter sales, Ebitda and EPS – while investing for the future and returning substantial capital to shareholders through dividends and share repurchases,”CEO Brian Jenkins said.

During the quarter, comparable store sales declined 1.8%, compared a decrease of 2.4% in the prior-year quarter, due to a 2% decrease in walk-in salesFurther, operating income rose 0.6% from the year-ago quarter to $46.2 million. As a percentage of total revenue, it decreased 100 basis points to 13.4%.

The earnings before interest, taxes, depreciation and amortization inched up 5.3% to $79 million from $75 million last year. As a percentage of total revenue, Ebitda decreased 60 basis points to 22.9%. The adjusted Ebitda increased 4.4% to $86 million. As a percentage of total revenue, it decreased 80 basis points to 25%.

Moreover, during the quarter, the company repurchased 3.4 million shares for $137 million.

Looking ahead to full fiscal 2019, the company expects total revenue to be between $1.338 billion and $1.359 billion and net income to range from $91 million to $100 million.

During the quarter ended June 30Paul Tudor Jones (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) established new positions in the stock. Steven Cohen (Trades, Portfolio) boosted his holding by 275% to 117,896 shares. On the other hand, Lee Ainslie (Trades, Portfolio) and Jim Simons (Trades, Portfolio)' Renaissance Technologies sold out of the stock.

Gainers

Losers

Global markets

The main European stock markets traded in the green. The U.K.'s FTSE 100 advanced 0.96%, France's CAC 40 rose 0.44%, Germany's Dax swelled 0.74% and Spain's IBEX 35 dipped 0.21%.

In Asia, Japan's Nikkei 225 gained 0.96%, India’s BSE Sensex rose 0.34%, Hong Kong's Hang Seng climbed 1.78% and China's Shanghai Composite slid 0.41%.

Disclosure:The author holds no positions in any stocks mentioned.

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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