RICK - RCI Hospitality Holdings: Danger Lurks Beyond The Reopening Trade
- RCI Hospitality Holdings operates strip clubs, nightclubs, topless gentlemen's clubs, adult entertainment websites, and a military-themed restaurant and sports bar chain called Bombshells.
- The stock was trading for around $10 during the coronavirus market crash of 2020, and has since exploded to over $77 per share with little change in fundamental value.
- The company has benefited from sentiment change late last year, but currently trades at an earnings multiple which is hard to justify.
- RCI Hospitality Holdings stock is in dangerous territory, and the company's debt situation combined with an industry experiencing declining growth leaves shareholders vulnerable with 50% downside risk.
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RCI Hospitality Holdings: Danger Lurks Beyond The Reopening Trade