Jun 10th, 2010
Considering Coinstar
While thinking about selling my stock in Netflix (NFLX), I’m considering what to buy if I do indeed sell it. Thinking about Netflix got me thinking about Redbox, the DVD rental kiosks that are popular through the United States (although I don’t believe they are operating in Hawai’i yet). A bit of research got me the information that Redbox is a subsidiary of Coinstar, which leaves me looking at the possibility of investing in that company instead.
Coinstar (CSTR) is a company known for converting loose change into paper currency; it also converts that change into gift cards or donations. They often charge a fee for the conversion. Coinstar also owns amusements that are located near the front of grocery stores (just as the Coinstar and Redbox machines often are).
In terms of its stock, CSTR is up almost 100% this year! It pays no dividend and has a high price to earnings ratio of 58.39. This is making me think I may have already missed the boat on CSTR (had this been January 1, it would have been a fine time to buy in).
I’m not sure about this one right now; my feeling is if I owned it right now I’d have more reasons to sell than to hold, so my guess is it’s not the one to replace Netflix in my portfolio.
[...] I’ve blogged about my belief in Coinstar for a little while now–my feeling is that in particular, their Redbox DVD kiosks were winners, and so far this year the market has agreed–it’s up 68.19% year to date. [...]