Dave And Buster's Entertainment, Kohl's, SAP SE, Microsoft And Apple Highlighted As Zacks Bull And Bear Of The Day

For Immediate Release

Chicago, IL – May 19, 2016– Zacks Equity Research highlights Dave and Buster’s Entertainment (PLAY) as the Bull of the Day and Kohl’s Corp (KSS) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on SAP SE (DE:SAPG) (SAP), Microsoft Corporation (NASDAQ:MSFT) (MSFT) and Apple Inc (NASDAQ:AAPL). (AAPL).

Here is a synopsis of all five stocks:

Bull of the Day :

Restaurant stocks have been benefitting from improving labor markets and savings from low gas prices. Dallas based Dave and Buster’s Entertainment ( PLAY) operates an arcade and restaurant chain that combines entertainment and dining in one location. The company was founded in 1982, when two friends Dave and Buster, who respectively ran a bar and an arcade side by side in Little Rock, AR, decided to combine the businesses. They IPO’d in 2014 with an offer price of $16 a share.

They currently operate 82 company owned stores in 30 states and Canada, which target adults aged between 21 and 39, with average household income of approximately $75,000. They aim to provide their guests the experience of “Eat, Drink, Play, Watch” all in one location.

In addition to proving strong sports viewing package and promotions, they are also aim to provide compelling venues for corporate and social special event parties. Special events comprised ~11% of fiscal 2015 revenue.

Solid Fourth Quarter Results and Improved Guidance

The company reported its fourth quarter results on March 29. Revenues increased 13.1% year-over-year to $234.2 million, while comparable sales increased 6%. Net income came was up 61.4% to $22.8 million, or $0.53 per share, handily beating the Zacks Consensus Estimate of $0.43 per share. The company has beaten the Zacks Consensus Estimate every single quarter since going public. The average positive quarterly surprise for the last four quarters is a very impressive 105.37%.

The management expects sales for the current year to be in the range of $967 million to $987 million, versus the street consensus of $976 million.

Rising Estimates

After excellent results and upgraded guidance, analysts have raised estimates for the company. Zacks Consensus Estimates for the current and the next year are now $1.78 per share and $2.07 per share respectively, up from $1.65 and $1.88, before the results.

Bear of the Day:

Retail sales trends have been pretty interesting of late. In addition to online shopping at Amazon (NASDAQ:AMZN), consumers increased their spending at off-price retailers like TJ Maxx and home improvement stores like Home Depot (NYSE:HD) but reduced their spending sharply at department store chains like Macy’s, Kohl’s and JC Penney. Kohl’s Corp (KSS) reported an 87% plunge in profit for the first quarter,
sending shares tumbling after the report.

About the Company

Headquartered in Menomonee Falls, WI, Kohl’s operates about 1,200 stores across 49 states and an e-commerce site. Kohl’s operates more than 1,100 family-focused department stores and a website, selling moderately-priced apparel, footwear and accessories for women, men and children and home products. The department store chain mainly targets middle-class consumers. Falling estimates sent the stock to a Zacks Rank #5 (Strong Sell).

Weak Results Reflect Rising Challenges

Kohl’s reported earnings of $0.31 per share for Q1, missing the Zacks Consensus Estimate of $0.36 by 13.9%. Earnings also declined a significant 50% from the prior-year quarter due to a drop in sales and lower gross margin.

Net sales of $3.97 billion also missed the Zacks Consensus Estimate of $4.12 billion and were also down 3.7% from the prior-year quarter.

Falling Estimates

Analysts have slashed their estimates for the company after weak results. Zacks Consensus Estimates for the current and next fiscal year have fallen to $3.92 per share and $4.14 per share from $4.12 and $4.40 respectively, before the results.

Additional content:

SAP, Microsoft to Boost Cloud Capabilities

SAP SE (SAP) has strengthened its partnership with Microsoft Corporation ( MSFT) by making three key announcements at the 28th annual SAPPHIRENOW conference. The companies announced plans to provide extensive support to the SAP HANA platform on Microsoft Azure, integrate Microsoft Office 365 and cloud solutions and also boost management and security for SAP Fiori apps. The announcements, which come after two years since the companies entered into a partnership, are set to improve cloud capabilities for clients.

Inside the Headlines

As per the first announcement, SAP HANA, along with the company’s star performer S/4HANA, is now certified to conduct development, test and production related work on Microsoft Azure. Given the commendable success story of early adopters of this offering which include Coats, Rockwell Automation (NYSE:ROK) and Nortek, SAP believes the latest upgrade will help organizations deliver mission-critical applications and data analytics with paramount security and compliance measures.

Coming to cloud service integrations, cloud offerings from SAP including Concur, Fieldglass, SuccessFactors and Ariba will be combined with Office 365 communications, collaboration, calendar, documents to enhance customer experience. The companies have also stated that the new integrated solutions will be commercially available from the third quarter of 2016.

Finally, to improve the flexibility in cloud networks, SAP is allowing customers to construct mobile hybrid SAP Fiori apps on an open standards plug-in framework. Moreover, the apps built on the SAP HANA Cloud Platform can be managed and secured with Microsoft Intune. This offering is also expected to be launched commercially in the third quarter of 2016.

To Conclude

SAP and Microsoft are certain that their recent endeavors will significantly boost organizations’ ability to promote innovations on cloud and seize new business opportunities. SAP has for long been pursuing an open ecosystem strategy wherein it supports its partners through continual co-innovations, to stave off competition. Earlier this month, SAP teamed up with Apple Inc. (AAPL) to develop corporate apps for iPhones.

We believe partnerships with such leading technology companies will accelerate SAP’s cloud business significantly. It appears that the company’s efforts toward boosting its Internet of Things (‘IoT’) platform and cloud business through strategic partnerships are paying off and will expand its customer base further.

SAP currently holds Zacks Rank #2 (Buy).

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