yadayada Posted October 31, 2014 Share Posted October 31, 2014 Yea if I normalize 2014, I get 240-270m in FCF for the corebusiness . But it seems they cut some costs with redbox, so if next year is a bit better box office wise (and no big events like world cup), then That is over 300m$. And if they can increase price with Redbox, that could be 350+. And it seems new ventures are on pace. Revenue up like 40%. And revenue per machine is about 80k$ with a bunch of new machines rolled out. So that is very good. If they can keep this up for 8-10k eco atm's, that is another 50-100m$. This thing should at least trade at 110$+. Link to comment Share on other sites More sharing options...
Travis Wiedower Posted October 31, 2014 Share Posted October 31, 2014 Agreed. Pretty bummed I didn't have any spare cash to pick up additional shares under $50 recently. Universal and Lions Gate recent extensions is a good sign as well. Link to comment Share on other sites More sharing options...
thefatbaboon Posted October 31, 2014 Share Posted October 31, 2014 Agreed. Pretty bummed I didn't have any spare cash to pick up additional shares under $50 recently. Universal and Lions Gate recent extensions is a good sign as well. You'd have needed more than just ordinary cash to pick up shares under $50 recently. Maybe with some magic beans. Link to comment Share on other sites More sharing options...
Travis Wiedower Posted October 31, 2014 Share Posted October 31, 2014 Haha oops. Guess OUTR only dropped into the $51s, kept thinking it hit $48 for some reason. Probably mixed up with another stock. Still would've loved to pick up more in the $51 area! Link to comment Share on other sites More sharing options...
shhughes1116 Posted October 31, 2014 Share Posted October 31, 2014 Good example of a stock priced for abject failure....and then they release earnings showing that the company still has a pulse and still makes some money, and so the equity moves up substantially. My only regret is not buying the equity...wrote a bunch of 2017 $50 puts for $11 in premium instead.... Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 31, 2014 Share Posted October 31, 2014 I have a small position that I opened around $60 a little while back. Was hoping for another dismal quarter to buy on a 10-15% drop from $50ish. I guess markets can't be as ignorant as I want sometimes. Nite whats going on in Altius on the other hand... Link to comment Share on other sites More sharing options...
yadayada Posted October 31, 2014 Share Posted October 31, 2014 I like the long term options on this one. the Jan 2016 50$ options for about 12$. If they buy back another 200m$ at like 55$ , that is 15m shares. If you put a 7x multiple on 250m$ that is 116$ per share lol. How can you lose on those? You break even at a 930m$ market cap then lol.. Less then 4x FCF, potentially less then 3 if ecoatm business starts making money early next year like they project. Longer term options + buybacks and lots of FCF... :D What idiot is writing those things? If you knew options like ericopoly there is probably some way to leverage your return here without taking much more risk? Link to comment Share on other sites More sharing options...
ZenaidaMacroura Posted October 31, 2014 Share Posted October 31, 2014 I have a small position that I opened around $60 a little while back. Was hoping for another dismal quarter to buy on a 10-15% drop from $50ish. I guess markets can't be as ignorant as I want sometimes. Nite whats going on in Altius on the other hand... I opened a small position and was hoping to accumulate on a drop due to a the poor release quarter... Oh wells Link to comment Share on other sites More sharing options...
thefatbaboon Posted October 31, 2014 Share Posted October 31, 2014 Good example of a stock priced for abject failure....and then they release earnings showing that the company still has a pulse and still makes some money, and so the equity moves up substantially. My only regret is not buying the equity...wrote a bunch of 2017 $50 puts for $11 in premium instead.... Pretty sure that contract has only traded as high as $10. Are you sure you got 11? Link to comment Share on other sites More sharing options...
shhughes1116 Posted October 31, 2014 Share Posted October 31, 2014 Thanks, you are correct, puts executed at $10. The bid/ask kept dropping substantially right after I would put in my order, and then would immediately jump back up after cancelling my order...I tried about 5 times with the same effect each time. Anyways, on the last time, I opened two positions on the same side of the market...offered to sell 2017 puts @ $50 strike for $10, and offered to sell 2017 puts @ $50 strike for $11...executed immediately at $10, and was able to cancel the other sell-to-open "order". Although I would have been more than happy to accept more 2014 $50 strike puts @ $11... I've noticed this pattern with a few other stocks...FTR, ETP, WMB....very curious if you ask me...leads me to believe the liquidity represented by the current bid/ask is fake/non-human. Link to comment Share on other sites More sharing options...
Travis Wiedower Posted November 18, 2014 Share Posted November 18, 2014 Heard a radio advertisement for ecoATM a couple days ago, thought it was pretty good. I've thought before that people who don't frequent the stores that have ecoATMs have no idea there's an easy option like that available. Good to see OUTR is trying to get the word out. Link to comment Share on other sites More sharing options...
yadayada Posted November 24, 2014 Share Posted November 24, 2014 wow they increased prices of dvd to 1.5 and bluray to 2$ http://finance.yahoo.com/news/outerwall-hikes-prices-movie-video-133402412.html I hope they know what theyr doing.. Let's say revenue decreases, but they keep like 20% of the price increase, that is an additional 100m$ in pretax income. They did test this locally though. So Im curious what will happen here. I hope they are not stretching it. Link to comment Share on other sites More sharing options...
siddharth18 Posted November 24, 2014 Share Posted November 24, 2014 Is that why the stock popped today? I have to think that their price hike test at select locations went pretty well for them to do this. Maybe the market realized that consumers won't abandon Redbox due to 30-50 cent price hike and almost all of that extra revenue will fall to the bottom line. Link to comment Share on other sites More sharing options...
thefatbaboon Posted November 24, 2014 Share Posted November 24, 2014 slightly unnerving the size of the increase. they didn't increase guidance for the quarter - so i hope it's not knee jerk reaction to being under guidance. Link to comment Share on other sites More sharing options...
siddharth18 Posted November 24, 2014 Share Posted November 24, 2014 They know once they increase the price, there's no going back. I'm guessing they must've felt pretty confident from their data they harvested from selective price increases... If I recall correctly, the only cost that goes up with price increase is the Visa/MC/AmEx transaction fee. And as I discussed earlier (multiple times) in this thread, this company had pricing power that was untapped. Today it was communicated to the market that it's being tapped...and so the market reacted... Link to comment Share on other sites More sharing options...
siddharth18 Posted November 24, 2014 Share Posted November 24, 2014 Meanwhile on twitter... https://twitter.com/search?f=realtime&q=%40Redbox&src=typd Link to comment Share on other sites More sharing options...
yadayada Posted November 24, 2014 Share Posted November 24, 2014 Well they can lower the price again.. I think they can go back. But that won't be pretty. I can't help but think to just increase the price a bit more slowly? Maybe split it up in two steps or so. Also why not to 1.95$? 2$ looks much larger. I hope they are not gambling with the life of the company here... They should have combined this with some sort of action. Like a free one time dvd rental or something. Link to comment Share on other sites More sharing options...
shhughes1116 Posted November 24, 2014 Share Posted November 24, 2014 Given their successful increase with coinstar, I think you have to give them the benefit of the doubt with respect to this price increase. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted November 24, 2014 Share Posted November 24, 2014 Given their successful increase with coinstar, I think you have to give them the benefit of the doubt with respect to this price increase. Agreed. If you feel that they have a niche in this market, the 50% increase still leaves then as the cheapest alternative and doesn't change their niche. I'm glad they did this before 2015 - it's going to be a strong string of blockbusters next year and people aren't going to let 0.50 stand in their way. Link to comment Share on other sites More sharing options...
thefatbaboon Posted November 24, 2014 Share Posted November 24, 2014 Given their successful increase with coinstar, I think you have to give them the benefit of the doubt with respect to this price increase. Agreed. If you feel that they have a niche in this market, the 50% increase still leaves then as the cheapest alternative and doesn't change their niche. I'm glad they did this before 2015 - it's going to be a strong string of blockbusters next year and people aren't going to let 0.50 stand in their way. Wouldn't it have been better to have let customers get back into the habit first? Stupid analogy but.... Seems a bit like a dealer doubling his prices to an addict after he's just made it through a week detox. Surely one get's the habit started again first and then increase? Link to comment Share on other sites More sharing options...
gfp Posted November 24, 2014 Share Posted November 24, 2014 Remember that they have been testing price increases in certain markets for a while now. It's possible their data said the price elasticity was quite good for them so they went for it. I hope it works out for them. Link to comment Share on other sites More sharing options...
thefatbaboon Posted November 24, 2014 Share Posted November 24, 2014 Remember that they have been testing price increases in certain markets for a while now. It's possible their data said the price elasticity was quite good for them so they went for it. I hope it works out for them. unfortunately the tests would only have shown elasticity between prices during the time of the tests...they wouldn't have shown whether higher prices would stop people turned off by the weak slate coming back when the slate improves Link to comment Share on other sites More sharing options...
BTShine Posted November 24, 2014 Share Posted November 24, 2014 Remember that they have been testing price increases in certain markets for a while now. It's possible their data said the price elasticity was quite good for them so they went for it. I hope it works out for them. unfortunately the tests would only have shown elasticity between prices during the time of the tests...they wouldn't have shown whether higher prices would stop people turned off by the weak slate coming back when the slate improves As a (albeit self-proclaimed) stereotypical RedBox customer (I've no Netflix, watch 4 to 6 movies a year) I could care less if the movie costs $1.50 or $2.00 -- Not sure this price increase is a big issue. I only rent movies a few times a year. If I was a serious movie watcher I'd have Netflix. Just my 2 cents. Link to comment Share on other sites More sharing options...
yadayada Posted November 24, 2014 Share Posted November 24, 2014 just wish they made it a bit less then 2$. there are good reasons a lot of prices are just under a whole number. Link to comment Share on other sites More sharing options...
shhughes1116 Posted November 25, 2014 Share Posted November 25, 2014 just wish they made it a bit less then 2$. there are good reasons a lot of prices are just under a whole number. I'll take the other side of your argument. The difference between 1.95 and 2.00 is irrelevant. For someone that rents 30 movies over the course of a year from Redbox, that equates to an extra $1.50....extraordinarily minimal even for someone on the low end of the wage spectrum, especially when you consider that the Redbox provides an alternative to the cost of Netflix + highspeed internet. I don't dispute that there is a proven psychological impact when pricing something just under a whole number, but that presumes that there is a reasonably priced alternative. In this case, the "reasonably" priced alternative (highspeed internet + Netflix, or cable + VOD/SVOD) is still substantially higher than Redbox. Link to comment Share on other sites More sharing options...
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