LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg raised their target price on ten pin bowling centre operator Hollywood Bowl from 280.0p to 300.0p on Tuesday, stating there was a "strikingly obvious upside" to the stock.
Berenberg thinks the risk-reward profile of buying Hollywood Bowl shares has now very much so skewed to the upside, with sales running at a rate well ahead of 2019 levels.

The German bank highlighted that if the company can maintain even part of that momentum, the earnings upgrades this year will be "enormous".

On the other hand, if it doesn't, Berenberg believes the worst-case scenario for the stock will be that it merely meets its estimates and delivers "nice growth" as shareholders have a strong pipeline of new openings to look forward to.

"Based on the trading statement's guidance for the year-end net cash position, we estimate that Hollywood generated EBITDA in H2 2021 of over £20.0m, which is significantly more than it did in H2 2019 (£17m), despite being closed for the first six weeks of H2 2021. This demonstrates the strength of operational gearing at play," concluded Berenberg, which reiterated its 'buy' rating on the stock.

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