Coinstar: Piper Bullish on Redbox; Launches With Overweight Rating
Piper Jaffray analyst Michael Olson today launched coverage of Coinstar (CSTR) with an Overweight rating and $38 price target. The parent of the Redbox video kiosk chain closed yesterday at $31.96.
Olson sees several trends working in the company’s favor:
- DVD rental kiosk market is gaining share from traditional retailers like Blockbuster.
- Internet delivery likely still 3-5 years from going mainstream.
- Consumers shifting to DVD rentals from purchases due to low fees from Redbox – $1-a-day.
