Coinstar (NASDAQ: OUTR ) investors think they're braced for the worst.
Analysts see revenue growing just 2% through the first three months of this year, with profitability taking a big hit. Don't make the mistake of thinking that this is as bad as it can get. Coinstar stock could still be a colossal disappointment when it reports on April 25.
In this video, Rick explores why the company behind the disc-renting fleet of Redbox machines could be in for a choppy quarter. Coinstar's decision to team up with Verizon (NYSE: VZ ) to take on Netflix (NASDAQ: NFLX ) is too little, too late, and the venture will ultimately crush margins as it struggles to woo streaming video buffs.
Financially speaking, Rick wouldn't be surprised if Coinstar backs off its full-year guidance issued in February. There's little reason to expect Coinstar to post double-digit growth in the future.
There won't be a Hollywood ending for Coinstar stock, and it could be dangerous to own the shares heading into the report itself.
Dig deep into Coinstar
Internet video streaming may be all the rage, but customers still flock to the ubiquitous red boxes that spit out DVDs. How long can Coinstar, the company behind RedBox DVD rentals and its namesake loose-change coin machines, survive on this old media medium? Longer than many may think, especially with its new expansion plans. The opportunity is ripe for Coinstar to grab mark share, but is it the right time for investors to grab its stock? To answer this question, you're invited to check out The Motley Fool's new comprehensive research report on the opportunities, risks, and must-watch areas in Coinstar's future. Simply click here now to claim your copy today.