Coinstar up 7% After-Hours
Coinstar Inc. (NASDAQ:CSTR) is becoming what Blockbuster Inc. (NYSE:BBI) was in the 80's. Coinstar shares hit $29 a share after-hours thanks to their Redbox kiosks.
(AP) Coinstar Inc., which operates Redbox DVD kiosks, coin-counting and other self-service machines, issued financial guidance for the current first quarter on Tuesday after announcing it had come to an agreement with Warner Bros. over DVD distribution.
Redbox said it expects to earn 8 cents to 14 cents per share on $315 million to $330 million in revenue in the first three months of this year.
Under the terms of the deal, Redbox has agreed to wait 28 days after Warner Bros. releases a new movie on DVD before renting it out for $1 a night in its kiosk. The agreement ends a lawsuit Redbox filed against Warner Bros.' home video unit. Warner Bros. is a division of Time Warner Inc.
The guidance reflects what Coinstar believes is 90 percent of what Redbox will spend on DVD inventory for its kiosks all year. Before the agreement, Redbox paid higher prices to acquire Warner Bros. DVDs from retailers.
Coinstar also reaffirmed its earlier forecast for full-year earnings of $1.50 to $1.65 per share on $1.47 billion to $1.57 billion in revenue.