A good indication that a company lacks a future: its business model is lampooned by The Onion, a satirical news parody site, in a video featuring it as a "historical attraction." Blockbuster (NYSE: BBI) meets that fate in the video below.
This video should be required viewing for anyone contemplating an investment in the company's stock. I know, the company is attempting to transform itself into another Netflix (NASDAQ: NFLX), but the reality is that Blockbuster has no particular competitive advantage there, and its weak financial position makes it unlikely that it will survive and thrive in a price war.
I've been bearish on Blockbuster for a long time, and I just don't see any reason to think things will turn around.
Blockbuster: A 'historical attraction' in The Onion
Posted Sep 2nd 2008 10:45AM by Zac Bissonnette
Filed under: Bad news, Blockbuster Inc 'A' (BBI)
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Reader Comments (Page 1 of 1)
9-02-2008 @ 6:36PM
Robert Cunningham said...
I knew they were going to be in trouble when they discontinued stocking my Beta tapes :)
9-03-2008 @ 1:51PM
Kevin said...
Thats great reasoning there to buy or hold a stock. You are one bright individual.
If you knew anything at all you would know BBI operates in retail, mail order (like NFLX), and is starting kiosk distribution. BBI has better brand recognition, more distribution channels, goes after a bigger market demographic, and even sells movies, games, and gaming systems. BBI has stronger projected earnings growth as well. So my question is why own NFLX when you can own BBI?
Also, please back up with facts on your financial struggles. BBI has a good current ratio and if people would actually pay $4 or what the stock is actually worth the debt equity ratio (which is what you are looking at) would be good as well. B/c of the huge short interest and idiotic bashers like yourself the stock is down.