Outerwall Inc (OUTR): Don’t Write Off Redbox Just Yet

The industry has produced a bunch of bombs this summer, from Lone Ranger to R.I.P.D, After Earth to White House Down. Even so, revenues are still 12% higher, no doubt due to the success of surprise hits like The Conjuring. Yet average ticket prices are also higher than a year ago, up 5% as a result of 3-D and Imax movies pushing them up.

If I were to worry about any one thing with an investment in Redbox, it wouldn’t be the DVD, at least not yet, but whether Hollywood can produce quality fare that moviegoers will want to see — and then rent when it shows up in their local Redbox. Otherwise, it will be a horror show bigger than The Walking Dead.

The article Don’t Write Off Redbox Just Yet originally appeared on Fool.com and is written by Rich Duprey.

Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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