Tenpin bowling and family entertainment company Ten Entertainment (TEG:AIM) has all the attributes of a great investment at a great price.

Operationally, the business has performed superbly over the last two years against a difficult macroeconomic backdrop. It is positioned to continue to outperform, led by a clear focus on its unswerving value-for-money proposition.

As consumers continue to tighten their belts in the face of high inflation and rising interest rates, Shares believes Ten Entertainment’s value proposition will represent one of the few affordable family treats.

Like many leisure businesses Ten Entertainment had to close its doors during the pandemic. But unlike many companies it is now generating twice as much profit compared to before the pandemic, testament to the strength of its business model and good execution.

In the first half of 2022 the average realised price of a game of bowling including VAT was £5.19 which is 2.1% lower than the same period in 2019. However, the company has been rewarded with both higher footfall and customers spending more on each visit. For example, the average spend per head in the first half of 2022 increased by 7.4% to £15.98.

As management explained, ‘This inflation-busting approach means that against the trend of most other hospitality and leisure operators, we have been able to bring down our relative prices and significantly increase the value of the experience for our customers at every visit.’

Sites are being refurbished and new activities and revenue streams are being added by utilising otherwise dead space. For example, the company has added 16 extra bowling lanes, 21 karaoke rooms, 19 new escape rooms and two additional laser tag arenas since 2019.

Overall sales per square foot have increased by 41% since 2019 to £90 per square foot. Ten Entertainment has locked in energy prices at 2020 prices out to September 2024.

Historically the company has opened between two and four new sites a year. Centres in Crewe, Dundee and Milton Keynes are expected to open in the first half of 2023.

The shares trade on a mere 7.6 times forecast earnings for 2022, with the valuation ratio falling to seven times for 2023 while the forecast dividend yield of 4.3% is three times covered by earnings per share. The company is in a net cash position.

If the market doesn’t recognise the great value on offer from the shares now and drive a rerating in the stock, a trade or private equity buyer could feasibly step in and acquire it.

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