Outerwall (OUTR) PT Cut to $57 at Piper Jaffray on Lower Outlook; Maintains 'Overweight' on Valuation
Piper Jaffray maintained an Overweight rating on Outerwall Inc. (NASDAQ: OUTR), and cut the price target to $57.00 (from $88.00), following weak results from the company's Redbox division. Outerwall is now looking for 2015 Redbox revenue of $1.76B at the mid-point, down from prior guidance of $1.8B. The company did not adjust expectations for the ecoATM or Coinstar segments. OUTR announced a change in leadership for Redbox.
Analyst Michael Olson commented, "Outerwall lowered expectations for 2015 and announced a change in leadership for Redbox. The company now looks for 2015 Redbox rev of $1.76B at the mid-point, down from prior guidance of $1.8B. The company anticipates consolidated EPS of $7.90 on $2.2B in rev and EBITDA of $468M, down from the prior outlook for $9.17 on $2.2B and EBITDA of $500M. The new outlook compares to the Street at $9.35 on $2.2B in rev and EBITDA of $510M. The lowered guidance range is due to weaker than anticipated Redbox results for Nov. and expectations for Dec. The company also anticipates writing off assets related to SampleIt, which it will discontinue. Outerwall also announced that Mark Horak is vacating his role as Redbox President, with CEO Erik Prusch filling in on an interim basis. We are lowering our PT to $57, based on 7.5x 2016E EPS."
For an analyst ratings summary and ratings history on Outerwall Inc. click here. For more ratings news on Outerwall Inc. click here.
Shares of Outerwall Inc. closed at $58.06 yesterday.