Analysts: Coinstar CEO Departure Not ‘Negative’4 Jan, 2013 By: Chris Tribbey
The departure of Coinstar CEO Paul Davis should have no negative affect on Redbox or change the company’s strategy, according to analysts who cover the kiosk operator.
Eric Wold, analyst with B. Riley & Co. in Los Angeles, wrote in a note to investors that while Davis’s departure is disappointing, “we believe Coinstar has hired well ahead of the company’s growth curve and has built a deep management team that, most importantly, shares the same strategic views on the company’s direction and growth plans.”
Davis is leaving as CEO at the end of March and will be replaced by Scott Di Valerio, who has been Coinstar’s CFO since 2010. Galen Smith, SVP of finance for Redbox since 2009, will take over as CFO.
Shares of Coinstar suffered a dip after the announcement Jan. 3, but Wold wrote that investors should not be concerned, as “the senior management team all share[s] the same goals for Coinstar and visions for its growth.”
Michael Pachter, analyst with Wedbush Securities in Los Angeles, echoed those thoughts, writing that the changes would in no way be disruptive.
“We think Mr. Di Valerio is more than capable of leading Coinstar, as he has clearly demonstrated solid skills as CFO,” Pachter wrote. “In addition, the company will have three post-holiday months to transition, which we view as an adequate timeframe for a smooth transition.”