Player Avatar icu81mi (33.27) Submitted: 7/30/2010 11:17:25 AM : Underperform Start Price: $44.47 OUTR Score: +20.01

Today's sell-off was underdone if you ask me. This is one valuation that I just can't wrap my head around. 50 P/E for a company that rents out movies on a dying format for a dollar a day?? No, just no. There is absolutely not enough growth in that model to sustain to sustain this kind of multiple, not to mention all the debt they're taking on to fuel their expansion. Coinstar knows this too so they throw out "teasers" every once in a while about a possible streaming service to boost sentiment. Think about it. Even if streaming did somehow fit into Coinstar's model which it doesn't, what are the chances they can take any significant market share away from Netflix who utterly dominates that niche? The only thing I can see giving Coinstar a boost in the coming months is if Blockbuster ceases operations permanently in which case I would have to reevaluate.

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Member Avatar stpaulprius (< 20) Submitted: 8/8/2010 8:41:28 AM
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Warren Buffet say buy what you know, buy what you use. I use both Netfilx and Redbox. All this about online, you want something reasonably new it isn’t online. You have to wait for Netflix to get it in and then hope you get it on the weekend. The same weekend Redbox has it for a dollar, so on a Saturday night when Netflix hasn’t delivered something my wife wants to see, it’s off to Redbox for me!

Member Avatar Mark3twatch3r (< 20) Submitted: 2/21/2012 9:27:00 PM
Recs: 1

Sadly icu81mi is missing the bigger picture here. Yes DVD is a dying format, I will agree with that. But look at what's out there. Netflix has just signed a 56 day wait for new releases. Coinstar stating they will be doing streaming is not a teaser when they partnered with Verizon to offer this service. I don't think dropping a few million for a so called teaser was what they have done. We will have to wait and see. Streaming will fit in with Coinstars model and only make them stronger. Look at how far and fast redbox grew over e past several years. A few thousand kiosks to now over 30 thousand. Seems like this would be a wise investment to me. Now let's look at Hulu, really no content there and it's not pushing forward like Coinstars redbox model. Nobody in this economy wants to pay $4.99 for a one night rental and the latest I have seen $15+ dollars to watch a movie that is in theaters. Now Blockbuster, yet another dying model. NCR will be selling off their Bb express kiosks to Coinstar this year and more BB store will continue to close. Which will be 9000 more kiosks for redbox. Bottom line, prices drive business and in today's economy high prices will loose out. Coinstar is only growing and growing. I do not see any proof that they are setting up for failure. What you are looking at is market share and not what the business really is. Redbox makes millions each year and is only making more as Netflix and BB continue to loose customers. I see BB going completely under by the end of 2013. Netflix may go under or be sold off by the end of 2012. Redbox has made a business statement and has grow tremendously in the past 3 years and is only getting stronger. BB owned the dvd market for years, but their 15 minutes is up!

Where do you go to rent a DVD? I refuse to pay $4.99 for a one night rental period. Maybe money doesn't matter to you and your free to spend as you see fit. I like most people don't make tons on cash to blow.

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