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Analyst: Higher Market Share Has Redbox Looking Good

22 Jul, 2013 By: Chris Tribbey



Higher market share — from Netflix DVD attrition, the closing of Blockbuster stores and higher disc capacity at kiosks — should help benefit Redbox when parent company Outerwall (formerly Coinstar) reports its second-quarter financial results July 25, according to an analyst.

Michael Pachter, analyst with Wedbush Securities in Los Angeles, wrote in a note to investors that his firm estimates revenue of $585 million and earnings per share of $1.06 for the second quarter of 2013, up from $564 million and 99 cents, respectively, from the same quarter in 2012.

“If Q2 results had been weak, Outerwall likely would have preannounced results when it disclosed the ecoATM acquisition or name change in early July,” Pachter wrote.

Outerwall acquired San Diego-based self-serve kiosk company ecoATM for $350 million in cash in early July.

For the year, Pachter expects Outerwall to announce full-year expected revenue for between $2.38 billion and $2.54 billion.

“Although Outerwall has a spotty guidance track record, we believe the new management team’s conservative assumptions include a built-in cushion to allow a guidance increase,” he wrote.
 


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