At CBRL's nadir, the equity value (mkt cap) was worth <$700MM with debt+leases at 5x depressed EBITDA. Revenue growth is still negative, yet the mkt cap has surged to $1.2B. This was before the incompetent CEO was fired. What happened? Operating income margin recovered significantly as management took steps to manage costs better. CBRL traded as low as 7x EV/EBITDA, now 10x.
Right now, PLAY's equity value is <$400mm and debt+leases is 5.5x depressed EBITDA. Revenue growth was never as bad as at CBRL and should be flat to slightly positive in the next quarter yet the company remains valued at 7X EV/EBITDA and only 4.5X looking forward 12 months.
There is a huge potential for PLAY's improving financial performance to result is large and rapid appreciation in the market cap.