DA Davidson Raises Price Target on Coinstar (CSTR) Following Earnings
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Price: $20.10 --0%
Rating Summary:
4 Buy, 11 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
Rating Summary:
4 Buy, 11 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
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DA Davidson is reiterating its Buy rating on shares of Coinstar (NASDAQ: CSTR) and is raising its price target from $70 to $75 following the release of its Q4 results.
The company reported strong Q4 results as organic revenue growth rose 33.2 percent and earnings grew 47 percent. The solid upside was largely due to a 39.5 percent increase in Redbox revenues as Redboxs now make up 37 percent of the total market share. CSTR confirmed Redboxs should be implemented into Canada soon.
An analyst at DA Davidson comments, "We suspect concerns about price increase-driven attrition and Durbin-driven transaction price pressure will be replaced with speculation about how accretive the Blockbuster Express acquisition and the new joint venture with Verizon will be. At the end of the day, the company’s competitive positioning has improved. The DVD format remains the lowest price rental option and the new digital partnership should help retain attrition previously expected to shift to streaming. We believe numbers and share multiples will move up in 2012."
The firm raised its Q1 and FY12 EPS estimates from $0.79 and $4.05 to $0.89 and $4.18. DA Davidson also raised its FY13 estimate from $4.60 to $4.70. Revenues for FY12 and FY13 are forecasted to total $2.23 billion and $2.37 billion.
For an analyst ratings summary and ratings history on Coinstar click here. For more ratings news on Coinstar click here.
Shares of Coinstar closed at $50.56 yesterday.
The company reported strong Q4 results as organic revenue growth rose 33.2 percent and earnings grew 47 percent. The solid upside was largely due to a 39.5 percent increase in Redbox revenues as Redboxs now make up 37 percent of the total market share. CSTR confirmed Redboxs should be implemented into Canada soon.
An analyst at DA Davidson comments, "We suspect concerns about price increase-driven attrition and Durbin-driven transaction price pressure will be replaced with speculation about how accretive the Blockbuster Express acquisition and the new joint venture with Verizon will be. At the end of the day, the company’s competitive positioning has improved. The DVD format remains the lowest price rental option and the new digital partnership should help retain attrition previously expected to shift to streaming. We believe numbers and share multiples will move up in 2012."
The firm raised its Q1 and FY12 EPS estimates from $0.79 and $4.05 to $0.89 and $4.18. DA Davidson also raised its FY13 estimate from $4.60 to $4.70. Revenues for FY12 and FY13 are forecasted to total $2.23 billion and $2.37 billion.
For an analyst ratings summary and ratings history on Coinstar click here. For more ratings news on Coinstar click here.
Shares of Coinstar closed at $50.56 yesterday.
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