Monday, May 24, 2010

6th Ave. Adding Two More Philly Stores

6th Ave. Adding Two More Philly Stores: "Philadelphia - Sixth AvenueElectronics, the New Jersey-based A/V specialt..."

hhgregg Enters Philly, N.J. And Delaware

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Monday, May 17, 2010

Is It Too Late to Save Blockbuster?

Blockbuster, Inc
Rate BBI
CAPS Rating 1/5 Stars
Down $0.40 $-0.01 (-1.23%)

Netflix Hits $100!

David Gardner called Netflix in 2004 at $15.42. He’s up 546% as of April 23rd. See what David’s recommending that you buy NEXT.
Shares of Blockbuster (NYSE: BBI) tumbled 19% on Friday, as an ominous quarterly loss reignited bankruptcy concerns at the DVD rental specialist.
CEO Jim Keyes attempted to calm frayed nerves after the stock's slide. Blockbuster's Friday afternoon press release was peppered with upbeat quotes. The chain has "adequate liquidity" to get through the year. There are "promising negotiations" with its partners. However, even Keyes concedes that there are "execution risks" in seeing the retailer's objectives through. 
How could things have gotten this bad?
DVDs aren't dead yet
In theory, Blockbuster should be doing okay. Movie theaters set box office records last year. This should be good for the chain in two regards.
  • Hot movies hitting the big screen last year should be popular rentals when they reach the retail market several months later.
  • Scintillating results for exhibitors validate the theory that cinematic escapism is a winner during an economic downturn. If folks are going out to watch a movie, they should also be willing to head to the local video store to rent one.
But reality bites. Revenue slipped 13.8% during the first quarter, and a year-ago profit turned into a significant loss this time around.
The top line deserves an asterisk. Blockbuster has been closing stores, exaggerating the loss. Comps actually fell by a more modest -- though still problematic -- 7.1% globally and 7.8% domestically.
There's no need to organize a lineup of likely suspects. We know that Blockbuster's loss is a gain for Netflix (Nasdaq: NFLX), Coinstar's (Nasdaq: CSTR) Redbox, and the growing number of digital and pay-per-view alternatives.
After all, consumer appetite for movies isn't waning. Even as Blockbuster declines, Netflix has seen its subscribership grow 35%, to 14 million this year. Coinstar is growing even more quickly. Its DVD revenue has climbed 70% over the past year, with Redbox now accounting for 75% of the company's revenue.
In other words, Blockbuster can't blame the industry. The combined $208 million in revenue growth that Coinstar's DVD business and Netflix have drummed up over the past year far exceeds Blockbuster's $146 million top-line shortfall.
Movie studios have been bellyaching over waning DVD sales for a couple of years, but rentals are alive and well in the digital age -- at least for now.
The clock is ticking
Antsy creditors and worrywart auditors are making things tense at Blockbuster. That's a pity, because the company recent caught several unusual breaks:
  • Its nearest old school rival -- Movie Gallery -- announced earlier this month that it would liquidate its stores.
  • Blockbuster is taking the Redbox challenge head-on. NCR (NYSE: NCR) has teamed up with the chain to deploy more than 4,000 Blockbuster Express kiosks. That number exceeds the 3,240 stateside Blockbuster stores remaining at the end of the quarter.
  • Netflix and Redbox have struck deals with several major studios to delay new releases by 28 days. But Blockbuster has been able to maintain its ability to rent new releases the day they hit the market. Blockbuster's been flaunting that great edge (especially over Redbox) in its marketing.
A cockier Blockbuster with a cleaner balance sheet would be eating this up. Instead, as a consumer-facing company, all of the bankruptcy chatter may be eating away at its potential renter base. The typical Hurt Locker renter doesn't know the difference between bankruptcy reorganization and liquidation.
This isn't Blockbuster's only problem. Advertising and G&A costs are rising (as a percent of sales) as the chain shrinks. Interest expense nearly doubled over the past year. Merchandise sales -- at the domestic store level -- are also fading faster than rental revenue. This is a bit of a shock, given CEO Keyes' retailing pedigree.
I still like Blockbuster's long-term chances, but I'm certainly concerned about the fate of common shareholders, given the real possibility of a bankruptcy reorganization that will likely wipe them out.
Some closing optimistic thoughts
With a more benevolent balance sheet, it'd be easy to warm up to Blockbuster.
If folks are willing to pay a premium for 3-D and IMAX (Nasdaq: IMAX) screenings at the corner multiplex, they should also be willing to pay more to rent the emerging wave of 3-D Blu-ray discs at Blockbuster. There may also be some big-ticket opportunities for Blockbuster to take on Best Buy's (NYSE: BBY) booming home theater business, despite the limitations of its shrinking square footage.
Technology doesn't have to be Blockbuster's enemy, especially if richer platforms give optical discs some advantages over streaming video. Broadband providers are starting to get nervous about the data abuse of their "unlimited" connectivity plans. If they crack down on bandwidth use, they could destroy the digital streaming revolution in its infancy.
Blockbuster hasn't been asleep at the tech wheel. It teamed up with Deutsche Telekom's (NYSE: DT) T-Mobile to offer Blockbuster On Demand through its HTC HD2 smartphone two months ago. Enjoying piecemeal movie rentals on tiny smartphones may seem ludicrous, but if the tech takes off, it's better to be early than late.
Blockbuster sorely needs to hop on the Netflix streaming smorgasbord bandwagon -- instead of simply selling individual digital rentals -- and it certainly has the working relationships with Hollywood to do just that.
Given its dire financial straits, it would be a huge gamble to buy into Blockbuster these days. However, over the long haul, the market's not giving Blockbuster due credit for its potential as an entertainment retailer.
Will Blockbuster file for bankruptcy this year? Share your thoughts in the comment box below.

Monday, May 10, 2010

Conn's Q1 Comps Fall 20%

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Tuesday, May 4, 2010

hhgregg Enters Baltimore Market

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Monday, May 3, 2010

Ultimate Electronics Enters New York State

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Tuesday, April 27, 2010

Ultimate Opening In Pennsylvania

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Friday, April 23, 2010

hhgregg Announces the Grand Opening of Eight New Stores Serving Residents in Central PA, MD and VA

Stores to Feature Wide Selection of Brand Name Appliances and Electronics

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Chart for HHGregg, Inc. Common Stock

INDIANAPOLIS--(BUSINESS WIRE)--As part of its ongoing commitment to expand operations in the mid-Atlantic region, Indianapolis-based appliance and electronics leader hhgregg (NYSE:HGG - News) today announced that it will open its first stores in the states of Pennsylvania and Maryland along with an additional store in the state of Virginia on Thursday, April 22nd. The new stores can be found at the following locations:
  • Harrisburg, PA: 5125 Jonestown Rd. Lower Paxton, PA 17112
  • Lancaster, PA: 1700 Fruitville Pike, Suite G, Lancaster, PA 17601
  • Mechanicsburg, PA: 5800 Carlisle Pike, Mechanicsburg, PA 17050
  • Scranton, PA: 620 Commerce Blvd. Dickson City, PA 18519
  • Wilkes-Barre, PA: 101 Wyoming Valley Mall, Unit 900, Wilkes-Barre, PA 18702
  • York, PA: 351 Loucks Rd. Bldg. B, York, PA 17404
  • Hagerstown, MD: 17766 Garland Groh Blvd. Hagerstown, MD 21740
  • Winchester, VA: 2580 South Pleasant Valley Rd. Winchester, VA 22601
A ribbon-cutting ceremony for each store will take place at 2:45 p.m. on Thursday, followed by the official store openings at 3:00 p.m. Grand Opening sales will be held at each new store from April 22nd – May 1st, providing local residents with low prices on hhgregg’s wide selection of televisions, appliances and electronics. Customers will also be able to take advantage of special financing options on items throughout the stores, and will have a chance to register to win a Frigidaire Stainless Steel Appliance Package or a Magellan GPS.

“Entering the states of Pennsylvania and Maryland and expanding in the state of Virginia is an important milestone for our company and completes another phase of our strategic plan to expand operations in the mid-Atlantic region,” said Jeff Pearson, vice president of marketing for hhgregg. “Residents in each area can expect to find a wide selection of electronics and appliances at competitive prices, along with top-notch customer service from our knowledgeable sales team.”
Over 350 employees have been hired to staff the roughly 30,000 square foot stores. All employees undergo a comprehensive training program and receive more than 200 hours of product training each year. Like all hhgregg locations the new stores will showcase over 100 digital TVs and have more than 500 major appliances in stock every day.

To celebrate the new stores, and introduce more consumers to hhgregg, the Company will launch its "Show Me Your State" Facebook photo contest to all Pennsylvania residents from April 19th – May 8th. Residents simply need to download a picture of hhgregg's mascot, "hh," take a picture of him at their favorite location in Pennsylvania, and post it to his Facebook page for a chance to win a digital camera. The company’s "Show Me Your State" contest for Maryland residents will begin on May 4th and run through May 22nd. For official rules, please visit:

hhgregg (NYSE: HGG - News) is a specialty retailer of consumer electronics, home appliances, mattresses and related services operating under the names hhgregg® and Fine Lines®. hhgregg currently operates 139 stores in Alabama, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, North Carolina, Ohio, South Carolina, Tennessee, Pennsylvania and Virginia.

Thursday, April 22, 2010

Ultimate Electronics Enters Northeast

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