Dave & Busters IPO ($PLAY)

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djrez4
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Dave & Busters IPO ($PLAY)

Postby djrez4 » Thu Oct 02, 2014 11:35 am

Expected pricing at $16-18, releasing 5.88 million shares.

Apparently, they've earmarked all of the $100-120 million they expect to raise for paying down debt. Revenue has been increasing over the past few years, but not in step with other, similar companies. The word is that they will remain cash-poor for the foreseeable future, both from paying down the $430 million in debt that will remain after the IPO and from capital expenditures in an effort to expand to an eventual goal of 200 locations (from 70 currently).

I hate D&B with a fiery passion and loath the thought of ever stepping into one. Then again, there are enough people out there who think drinking, eating fried food, and playing over-priced video games is a hoot that D&B has been making a profit.

I guess my biggest concern is that they've been trying to either go public or sell the company outright since 2012 and have failed. I may buy a few shares, but I'm not bullish on this one.
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MemberSince99
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Postby MemberSince99 » Thu Oct 02, 2014 12:46 pm

Why do you hate it? I've been there it wasn't bad not something I'd want to do every night but there are worse ways to entertain yourself.

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Postby djrez4 » Thu Oct 02, 2014 1:08 pm

MemberSince99 wrote:Why do you hate it?


a) I'm not a gamer, at all.
2) I dislike the crowd that tends to gather at our local D&B.
d) Everything is stupidly overpriced there - as bad as, if not worse than, going to see a movie.
$) The whole casino-like environment, knowing that the place is scientifically designed to separate you from your money, is evil.

But that's me. If you enjoy it, have fun.
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Postby daniel2304 » Thu Oct 02, 2014 1:42 pm

I saw this from loyal3 too and I was jumping into it until I read to the part they sell the shares to pay off debt. I withdrew from it because it does not sound really good to me to sold pieces of the company to pay off debt.

Mind I ask why you want to join in, djrez4?
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Postby CarefulBuilder14 » Thu Oct 02, 2014 2:55 pm

Here is the 10-K:http://ir.daveandbusters.com/financials.cfm?company=inc

60% of the operating earnings are going to paying interest on the debt (as of 2/2/14).

A lot of the growth is coming from opening new locations (inefficient and expensive) and only a little is from getting more people coming to each location and spending more (there should be more of this). In Wall St. lingo, it lacks much organic growth.

Their plans to open new locations will require a lot of cash, and there's no way to get that cash on attractive terms.

I've seen enough to know it's not for me.
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Postby nismoZtuner » Thu Oct 02, 2014 3:48 pm

Their drinks are very cheap unlike clubs or some bars!
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Postby djrez4 » Thu Oct 02, 2014 5:34 pm

daniel2304 wrote:Mind I ask why you want to join in, djrez4?


It would be a quick buy in and sell from me. I don't see it gaining much and I certainly don't expect long term growth.
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