Analyst Sees Big Q4 for Redbox, Despite 28-day Delays

13 Jun, 2011 By: Chris Tribbey

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Half of the new-release titles appearing in Redbox kiosks during the fourth quarter will be subject to the 28-day delay agreements with Warner, Universal and Fox, but that won’t stop Redbox from enjoying its best three months of 2011, an analyst said June 13.

Eric Wold, director of research for Merriman Capital, estimates that the fourth quarter will see 11 of the year’s $100 million-plus box office hits, including The Hangover 2, Transformers 3, Cars 2, Captain America and the final installment of “Harry Potter.” Even accounting for the 28-day window, Redbox parent Coinstar should look forward to fourth-quarter revenue of $1.87 billion and earnings of $359 million, he said.

“With … Redbox inventory issues seemingly behind the company, we continue to believe Redbox now has an opportunistic (and clearer) growth runway ahead of it,” Wold wrote in a note to investors. “We believe Coinstar management is more appropriately managing forward expectations to provide more opportunities for upside results in the coming quarters.”
 

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