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Coinstar Inc. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: February 9, 2013 05:36AM
Coinstar Inc. (CSTR) filed Annual Report for the period ended 2012-12-31. Coinstar, Inc. has a market cap of $1.46 billion; its shares were traded at around $48.46 with a P/E ratio of 9.8912 and P/S ratio of 0.7279. Coinstar, Inc. had an annual average earning growth of 17% over the past 10 years. GuruFocus rated Coinstar, Inc. the business predictability rank of 4-star.
Highlight of Business Operations:incremental revenue and provide a broader product offering. Same store sales reflects the change in revenue from locations that have been operating for more than 13 months by the end of the reporting period compared with the same locations in the same period of the prior year.
$274.4 million increase in direct operating expenses attributable to revenue growth, including higher than optimal DVD product costs related to purchases of December 2010 and January 2011 titles, as well as increased video game product costs in support of our national rollout in June 2011, increased revenue share and payment card processing fees directly attributable to the revenue growth and increased kiosk field operations expenses due to the growth in the installed kiosk base. Partially offsetting these increases were extensions of the DVD license amortization periods from 26 weeks to 52 weeks for certain studios due to amended agreements and lower restricted stock expense due to a lower market price of our common stock on the last day of the calculation period when compared to the prior period. As our installed kiosk base grows, we continue to better utilize our existing field resources and lower the servicing costs per kiosk. Due to the price increase mentioned above and ongoing investments in process improvements, direct operating expenses as a percent of revenue for 2011 was 72.6%, down 150 basis points from 74.1% in 2010;
We performed the annual goodwill impairment test based on the two-step process described above as of November 30, 2012. We estimated the fair value of our reporting units using both the income and market approaches. Our estimates of fair value can change significantly based on factors such as revenue growth rates, profit margins, discount rates, market conditions, market prices, and changes in business strategies. As the estimated fair value of each reporting unit substantially exceeded its respective carrying value there was no goodwill impairment in 2012.
Stocks Discussed: CSTR,