Despite posting numbers and making some business decisions in 2010 that have disappointed investors, Redbox still has cautiously optimistic cheerleaders in the form of several prominent industry analysts.
Wedbush Morgan’s Michael Pachter believes that overall, Redbox parent Coinstar is “a healthy company with solid earnings growth prospects”. Said Pachter:
“Redbox didn’t have 40% of the movies that were advertised, resulting in further cannibalization of its rentals in favor of DVD purchases . . . The Q4 problem was worse than reported results suggest … [and] we remained baffled about how the company’s modest miss for the December quarter could translate into a much larger miss for the [upcoming first quarter].”
Merriman Curhan Ford analyst Eric Wold believes that the kiosk market has not yet reached maturity and that Redbox’s management team is up to the task of growing the company in 2011. Said Wold:
“While management is in a new learning curve, we remain confident in their ability to overcome these issues and deliver in 2011,”
D.A. Davidson & Co. analyst John Kraft is also cautiously bullish on Redbox’s prospects this year:
“While it remains to be seen, we do believe the management team can make appropriate adjustments,”
We’ve heard from the analysts, now let’s hear from you, Insiders. A year from now, will we be looking back at 2011 as the year Redbox flew higher or began its fall?
(via Home Media Magazine)