Comparing Redbox Entertainment and Netflix

$Redbox Entertainment Inc.(RDBX)$ $Netflix(NFLX)$

Redbox Entertainment and Netflix are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

81.0% of Netflix shares are held by institutional investors. 2.4% of Netflix shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Redbox Entertainment and Netflix’s net margins, return on equity and return on assets.

Risk and Volatility

Redbox Entertainment has a beta of -2.96, meaning that its share price is 396% less volatile than the S&P 500. Comparatively, Netflix has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Redbox Entertainment and Netflix.

Redbox Entertainment presently has a consensus price target of 7.00, suggesting a potential downside of 40.12%. Netflix has a consensus price target of $351.87, suggesting a potential upside of 102.98%. Given Netflix’s stronger consensus rating and higher possible upside, analysts clearly believe Netflix is more favorable than Redbox Entertainment.

Earnings and Valuation

This table compares Redbox Entertainment and Netflix’s revenue, earnings per share and valuation.

Netflix has higher revenue and earnings than Redbox Entertainment.

Summary

Netflix beats Redbox Entertainment on 12 of the 12 factors compared between the two stocks.

About Redbox Entertainment

Redbox Entertainment Inc. operates a network of self-service kiosks in the United States. It operates a network of approximately 38,000 self-service kiosks, where consumers could rent or purchase new-release DVDs and Blu-ray Discs. The company provides installation, merchandising, and break-fix services to other kiosk businesses. It also produces, acquires, and distributes movies through its film distribution label, Redbox Entertainment, LLC, providing rights to talent-led films that are distributed across the company's services, as well as through third party digital services. In addition, the company offers transactional and ad-supported digital streaming services, which include Redbox On Demand, a transactional service that provides digital rental or purchase of new release and catalog movies and TV content; Redbox Free On Demand, an ad-supported service providing free movies and TV shows on demand; and Redbox Free Live TV, an ad-supported television service giving access to approximately 100 linear channels. The company is based in Oakbrook Terrace, Illinois.

About Netflix

Netflix, Inc. provides entertainment services. It offers TV series, documentaries, feature films, and mobile games across various genres and languages. The company provides members the ability to receive streaming content through a host of internet-connected devices, including TVs, digital video players, television set-top boxes, and mobile devices. It also provides DVDs-by-mail membership services in the United States. The company has approximately 222 million paid members in 190 countries. Netflix, Inc. was incorporated in 1997 and is headquartered in Los Gatos, California.

source: MarketBeat