March 10, 2010 11:39 AM EST
Canaccord Adams initiates coverage on Coinstar (Nasdaq: CSTR) with a Buy rating at $39.
Canaccord analyst says, “Coinstar has a solid plan in place to expand on the number of installed DVD Kiosks, with plenty of runway ahead before full market penetration becomes an issue. The company also continues to chip away at the number of outstanding major studios left to sign agreements with, and is in test trials with a digital streaming strategy that should get it in front of the major transition that we see coming in the near future. Its legacy coincounting business is currently in maintenance mode, but a rollout of increased service fees should pad an already stable revenue stream. Additionally, the company is planning on divesting non-core assets (e-payment and money transfer) to focus on its core DVD and Coin segments. While work-around processes still remain for two major studios, we believe that the probability of striking an agreement is high and see the aforementioned catalysts outweighing this challenge…$39 target price based on 21x our 2011 GAAP EPS estimate of $2.23 and subtracting net debt/share of roughly $8.”
To see all the upgrades/downgrades on shares of CSTR, visit our Analyst Ratings page.
Coinstar, Inc. provides automated retail solutions primarily in the United States, Canada, Puerto Rico, the United Kingdom, Mexico, and Ireland.
Source | The Street Insider
