Dave & Buster's (NASDAQ: PLAY) shareholders had a strong start to the year as the stock gained 16% compared to an 8% spike in the S&P 500 , according to data provided by S&P Global Market Intelligence .
The boost put the volatile stock back in positive territory for the past 52 weeks, up 4% versus a 1% drop in the broader market.
January's rally came courtesy of a positive mid-quarter update from the restaurant and entertainment chain's management. CEO Brian Jenkins and his team said recent marketing, menu, and gaming improvements have helped turn the tide on revenue growth . As a result, sales at existing locations are now expected to rise by between 1.8% and 2.5% in the fiscal fourth quarter compared to a 1.3% decline last quarter . Dave & Buster's also lifted its earnings outlook for the period.
The stronger fourth-quarter growth likely won't be enough to keep the chain from reporting its second straight year of falling comparable-store sales. However, the rebound does suggest that management has a good handle on the issue heading into 2019. The return to positive customer traffic, meanwhile, supports the chain's aggressive store-growth goals that target expanding the base by about 10% each year for the foreseeable future.
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