B. Riley Securities started off coverage on Bowlero Corporation (NYSE:BOWL) with a Buy rating and a 12-month price target of $18 per share off what it sees as an attractive entry point for investors.
Analyst Eric Wold and team believe Bowlero (BOWL) is well positioned to take even more market share from a fragmented and old school bowling industry due to the management team with a proven track record of value creation from acquisition conversions.
"While Bowlero already generates the highest EBITDA margins of the live entertainment peer group, we see multiple opportunities for management to further boost bowling center margins in the coming years."
Bowlero (BOWL) shares are noted to be trading at more than a 25% discount to the peer group in what the firm sees as an overreaction by investors to management’s cautionary comments on the Q3 conference call. Per BTIG, Bowlero (BOWL) shares are currently pricing in an expectation for a mid-teens percentage same-store sales decline through 2024. That magnitude of a decline is seen as unrealistic.
Shares of Bowlero (BOWL) rose 2.15% in early trading on Monday.