Movie rental and streaming service Redbox (NASDAQ: RDBX) the stock hits higher lows after completing its business combination. The company merged with Special Purpose Acquisition Company (SPAC) Seaport Global Acquisition Corporation on October 22, 2021, to find its way into the public markets. The company began selling home products, snacks, and electronics at its famous red kiosks, but evolved into DVD rentals and movie streaming services in its 20-year history, after Blockbuster video. The company also offers a selection of ad-supported free streaming movies under a deal with WarnerMedia (NASDAQ: DISCA). It is now the only (literally) one stop shop to rent physical DVDs over the air (not by mail). Adding the streaming options through its app helps it grow its consumer and subscriber network as it grows as a digital business. Cautious investors looking for another way to market themselves in the streaming and DVD rental industry may look for opportunistic pullouts from Redbox stocks.
According to Redbox’s investor presentation, the company had revenue of $ 829 million in 2019, which dropped to $ 546 million in 2020 due to COVID-19. The company is forecasting a 27% CAGR to $ 1.122 billion by 2023 from 2020 lows, with $ 40 million in digital revenue to hit $ 384 million by 2023. The 2020 revenue decline is due to the impact of COVID-19 of a drop (-50%) new versions. New versions result in DVD rentals. The company has 39 million loyal members and 46 million email subscribers. The video-on-demand transactional service (TVOD) launched in 2017 calculates a customer acquisition cost of $ 3 per customer. Since DVD renters are considered late adopters, Redbox sees them as attractive conversions to its digital operations. Its digital network includes DVD rentals, free live TV, free on demand, premium 3e party channels and multi-product digital service subscription. Redbox also plans to develop its own exclusive content with plans for 36 titles per year.
The digital ecosystem
Jason Kwong, Director of Digital Strategy at Redbox, explained, “Our vision and goal is to create a multi-product digital ecosystem that provides our customers with the widest choice. See it as a one-stop-shop for a variety of content and content services, which we will adapt to better serve our value-minded and late-user customer base, and further differentiate ourselves by delivering greater value through our program. loyalty Perks which is currently 39 million members … If you take a close look at this ecosystem it starts to look like a traditional MVPD or cable service, where you can browse a ton of linear channels, rent new movies on demand and subscribe to premium services such as HBO and Showtime, all under one service. And this is where we see the opportunity.
RDBX Opportunistic Withdrawal Levels
Using the gun charts over the weekly and daily periods provides an accurate view of the landscape for the RDBX stock. Rifles weekly chart peaked at $ 27.24 Fibonacci level (fib). Stocks fell sharply to the $ 11.80 level to stage an attempted rebound. Support for the 5-period weekly moving average (MA) slipped to $ 13.71 with a 15-period MA rising to $ 11.17 fib. The Weekly Stochastic is starting to cross the 20 band. The Daily Guns chart has trended down with a 5-period MA down to $ 12.77. The Daily Stochastic again crossed a 20-band rejection, pushing stocks towards the daily Bollinger (BB) bands below $ 20.28 fib. Bulls will need $ 14.37 breakout to trigger daily weak market structure (MSL). Cautious investors can watch for opportunistic pullback levels at $ 11.80 fib, $ 11.17 fib, $ 10.28 fib, $ 9.75 fib, $ 9.15 fib, and $ 8.75 fib. The upward trajectories are from the fib of $ 16.64 to the fib level of $ 23.99.
Should you invest $ 1,000 in Redbox right now?
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