Piper Jaffray Raises Coinstar Estimates in Face of Strong Redbox Growth (CSTR)

Piper Jaffray analysts Michael Olson and Andrew Murphy raised estimates for Coinstar CSTR in light of strong market conditions for its Redbox service. Coinstar operates automated retail solutions, including its ubiquitous green Coinstar machines and Redbox DVD kiosks. The analysts raised their CY11 DVD EBITDA margin estimate to 19.5% from 18.9%, resulting in an increased EPS of $2.75, up from $2.57. The analysts said, "With retail rental store closures, a growing kiosk footprint, and deals in place with all major content owners, Redbox is positioned to see material revenue growth and margin expansion over the next several years." Piper Jaffray rates Coinstar Overweight, with a price target of $62.00. CSTR is currently trading at $42.97.