Is BBI the next SIRI?

P

PolymathMind

Imagine, if you bought SIRI at .10 and sold now. Easy 500k banked.

What are your opinions on BBI? The magical day is 13 of May when they report for the quarter... do you think this will be another SIRI or is it Chapter 11 for BBI?
 
I think they're on their way out....
I had 3 of their stores in my neighborhood and they all got shut down, along with a hollywood video...

Too much competition - and too much convenience at a cheaper price for the business model to remain viable.
 
On February 10, 2010, Blockbuster announced that it would cease all its operations in Portugal. closing down in the process 17 outlets and leaving over 100 workers unemployed. Blockbuster representatives in Portugal blamed internet piracy and the lack of government response to it as the key factors to the company's bankruptcy in the country.[10] By March 2010, Blockbuster was in talks of selling its European operations altogether, but would not disclose the details.

On March 1, 2010, Blockbuster reincorporated late fees for rentals not returned by their due date. An "Additional Daily Rate" is charged for each day a member chooses to keep the rental following the "Initial Rental Period". This has been blamed for Blockbuster's abnormally high 2009 loss financial figures[11].

On March 12, 2010, PricewaterhouseCoopers, Blockbuster's independent registered public accounting firm, issued its audit opinion disclosing substantial doubt about Blockbuster's ability to continue as a going concern. This report was included in Blockbusters's 10-K SEC filing. On March 17, 2010, Blockbuster issued a bankruptcy warning after continued drops in revenue threatened its ability to service its nearly 1 billion dollar debt load.[12]

By April 1, 2010, majority shareholder, Carl Icahn, had resigned from Blockbuster's board of directors and reduced his interest in Blockbuster from 16.9% to 2.5%.
 
I like BBI for several reasons. But, I think they should declare CH.11 to wipeout existing debt. Then they could be very profitable going forward. They would lose their Canadian assets to the studios, but that's not a big issue considering their presence in Canada is quite small compared to Rogers. Their England operations is doing great. Anyways, here are the several reasons why I like BBI:

1) Mailing week reduced from 6 days to 5. The visibility will affect NFLX a little bit.

2) Several major studios are signed up with BBI and there are 30 day delays to CSTR and NFLX.

3) BBI is expanding their kiosks, streaming, and expanding their online offerings. They will target video game rentals soon. I just received a mail to beta test their mail rentals of video games.

4) They offer Blu Ray at no extra cost.

5) They offer video games. I think this one could be huge. If they get into the used games market, they could compete with GameStop and rent out games that haven't sold. They would potentially extend lines of service

6) Have you seen the major shareholders? Not only is Goldman Sachs on there, but Rennaissance Tech! RT also owns NFLX, so I think they have their bases covered. They probably realize that if BBI could turn its operations around, a small 1% invested capital could potentially become a 10% one. So far, all the stocks I've tracked from RT have done well in the past year.

7) The stores sell other stuff besides movies and games. They make profits off selling candies, popcorn, soda, and electronics.

I don't own BBI, but I am a member of their Total Access plans. It's really good. I do think the company would do better if it declared CH.11. Personally, I would only invest a 1% stake in the common if it tanks to 0.10. It might even be better just to buy long dated LEAP options.

I also see BBI as a potential SIRI. I've been looking at this one for awhile. I just sold off CSTR and GME today. I'm ready to roll in a little bit of the profits into BBI.
 
Quote from BartS:

On February 10, 2010, Blockbuster announced that it would cease all its operations in Portugal. closing down in the process 17 outlets and leaving over 100 workers unemployed. Blockbuster representatives in Portugal blamed internet piracy and the lack of government response to it as the key factors to the company's bankruptcy in the country.[10] By March 2010, Blockbuster was in talks of selling its European operations altogether, but would not disclose the details.

On March 1, 2010, Blockbuster reincorporated late fees for rentals not returned by their due date. An "Additional Daily Rate" is charged for each day a member chooses to keep the rental following the "Initial Rental Period". This has been blamed for Blockbuster's abnormally high 2009 loss financial figures[11].

On March 12, 2010, PricewaterhouseCoopers, Blockbuster's independent registered public accounting firm, issued its audit opinion disclosing substantial doubt about Blockbuster's ability to continue as a going concern. This report was included in Blockbusters's 10-K SEC filing. On March 17, 2010, Blockbuster issued a bankruptcy warning after continued drops in revenue threatened its ability to service its nearly 1 billion dollar debt load.[12]

By April 1, 2010, majority shareholder, Carl Icahn, had resigned from Blockbuster's board of directors and reduced his interest in Blockbuster from 16.9% to 2.5%.
More...

Barts, can you provide the source of this please? Thanks for the info.
 
BBI has no float and huge short interest that alone makes it a buy does anyone remember MACE or TASR all sucked but destroyed the shorts before coming back to zero.
 
Blockbuster is done with, I have no clue why they still have stores open and why they continue to think they can face the ever growing competition, they were extremely late to the kiosk race of $1.00 rentals and are now trying extremely hard to catch up with Redbox and DvdExpress. They still have over 3,000 locations open around the US and should just shut them down and close up, this company faces extreme competition moving forward.

The idea of going into a store to rent a dvd is done with, even the dvd rental kiosks in supermarkets around the US will be gone in the next few years as nearly everyone will be downloading and streaming movies straight to their computers and televisions sets through set top boxes. Netflix will even shut down their mail order rentals sometime over the next 5 years as the newer cheaper method will continue to be to stream movies directly to televisions and computers.

Your nearest blockbuster will be closing soon.
 
You must log in or register to reply here.
Back
Top