In a report released today, Eric Wold from B.Riley Financial reiterated a Buy rating on Bowlero Corp. Class A (BOWL – Research Report), with a price target of $18.00.
Eric Wold’s Buy rating on Bowlero Corp. Class A’s stock (BOWL) is based on several factors. Firstly, he believes the recent criticism of the company’s business model and financial outlook from a financial newsletter has been misinterpreted. Specifically, the launch of a bundle that offers a third game of bowling for only $5 and provides a “free” $5 gaming card for the arcade was criticized, but Wold sees this as a smart and profitable offering. It not only keeps consumers at the center for longer periods, encouraging additional food and beverage purchases, but also generates a higher margin for the company.
In addition, Wold doesn’t see the company’s promotional strategies to drive traffic during slower periods as a negative, but rather as a normal way of doing business. The analyst also notes that Bowlero’s same-store sales have already returned to positive levels, much earlier than the 4Q24 originally forecasted by the management. Finally, Wold believes that the company’s leverage ratio is reasonable when only traditional debt is considered, and he anticipates that Bowlero could pursue sale-leaseback transactions on its real estate portfolio to demonstrate the value of an overlooked asset. This combination of factors led Wold to reaffirm his Buy rating and $18 price target.
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Based on the recent corporate insider activity of 61 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of BOWL in relation to earlier this year.
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Bowlero Corp. Class A (BOWL) Company Description:
Isos Acquisition Corp is a blank check company.
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