Amid a 13% Stock Slide, a Fund Scales Back Its Lucky Strike Exposure by $9 Million | The Motley Fool

New York City-based Alta Fundamental Advisers reduced its position in Lucky Strike Entertainment Corporation (NYSE: LUCK) by nearly 1.1 million shares, contributing to an $8.73 million position decrease, according to a November 13 SEC filing. What Happened According to a filing with the Securities and Exchange Commission dated November 13, Alta Fundamental Advisers sold nearly 1.1 million shares of Lucky Strike Entertainment Corporation (NYSE: LUCK) during the third quarter. The transaction reduced the fund’s stake in the company by $8.73 million, leaving a remaining holding of nearly 1.1 million shares worth $11.2 million as of September 30. What Else to Know The fund’s LUCK holding now represents 4.78% of reportable assets, down from 10.2% the prior quarter. Top five fund holdings after the filing: NYSE:GCI: $46.1 million (22.4% of AUM) NASDAQ:LILAK: $15.6 million (7.6% of AUM) NYSE:BTU: $14.9 million (7.2% of AUM) NYSE:ACHR: $12.8 million (6.2% of AUM) NYSE:CC: $12.7 million (6.2% of AUM) As of Monday, LUCK shares were priced at $9.02, down 13% over the past year and well underperforming the S&P 500, which is up 16% in the same period. Company Overview Metric Value Revenue (TTM) $1.23 billion Net Income (TTM) ($46.91 million) Dividend Yield 2.7% Price (as of Monday) $9.02 Company Snapshot Lucky Strike Entertainment operates bowling centers, amusement parks, water parks, and family entertainment venues under brands such as AMF, Bowlero, Lucky X Strike, Boomers, and PBA. Its business model centers on location-based, experiential entertainment, combining traditional bowling with modern amusements, food, and hospitality services. The company serves a broad customer base, including families, groups, and casual entertainment seekers across North America. Lucky Strike Entertainment Corporation operates at scale in the North American leisure sector, leveraging a portfolio of well-known brands to attract a broad customer base. The company focuses on experiential entertainment, combining traditional bowling with modern amusements and hospitality offerings. Its diversified venue mix and recognizable brands provide a competitive edge in the location-based entertainment market. Foolish Take This move serves as a good reminder that operating leverage can cut both ways in experiential businesses. Lucky Strike just posted a quarter where revenue rose 12.3% year over year to $292.3 million, driven by food, beverage, and amusement growth, yet the quarter still ended in a net loss of $13.8 million as interest expense and expansion costs piled up. Adjusted EBITDA climbed to $72.7 million (from $62.9 million one year prior_, and management reaffirmed full-year guidance calling for up to $1.31 billion in revenue and as much as $415 million in adjusted EBITDA. On paper, that looks like momentum. But same-store revenue slipped 0.4%, and the balance sheet now carries roughly $1.7 billion in net debt following a refinancing that pushed maturities out but locked in meaningful interest costs. That combination matters when discretionary spending softens. Basically, Lucky Strike is still growing, but it is growing into a more leveraged structure. For patient investors, the bull case hinges on margin expansion and cash flow catching up to revenue. The bear case is that flat...

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