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Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

post #1 of 39
3/3/09 at 9:37pm
Thread Starter 
So while at work today we found out the share price went from 96 cents to 22 cents a share.
this was after BBV hired a firm to
"Blockbuster Hires Law Firm to Explore Restructuring"
Blockbuster Hires Law Firm to Explore Restructuring - WSJ.com

so is this it.
Can a business recover from such a drop.

Now I know there will be those who come
in here and say good riddance, they stink, I hope they rot in hell, etc.

well please add something to the conversation besides "they suck."

Working there doesn't bias me towards them in any way.
It's just a part time job essentially to appease my wife.

As a customer I like going into a video store and looking around to pick out a movie to watch.
With only 1 other video rental place in this area, i'd be
somewhat sad to see bbv go.
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post #2 of 39
3/3/09 at 10:31pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

It would be the end of an era, that's for sure. Nothing on the level of GM going away, but in the home video market, certainly a big deal. Though you could argue the writings been on the wall for some time, it's just one more crazy thing in this current economy.
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post #3 of 39
3/3/09 at 10:45pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Cameron Yee
Though you could argue the writings been on the wall for some time, it's just one more crazy thing in this current economy.
This is the key point, I think. Dropping 77 percent in one day is still unusual, but it's hardly unique in this market.
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post #4 of 39
3/3/09 at 11:26pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

it's certainly ironic to see cinemas having a record year so far, while rentals stores are finally going broke.
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post #5 of 39
3/4/09 at 3:46am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Guess I better do something with that $10 gift card I have laying around somewhere. It's also indicative of how our lifestyle is changing. Some industries just can't adapt.

When I worked for Webvan, their stock price dropped from 90 cents to 22 cents three or four times before they called it quites.
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post #6 of 39
3/4/09 at 5:03am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Netflix is holding steady...

Netflix - Stock Quote & Chart
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post #7 of 39
3/4/09 at 7:51am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Their demise is bound to happen unless they change their business model, but it's probably way too late now. There's Redbox (less overhead), Netflix (which also has online streaming), and legal online video websites (Hulu, etc.).
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post #8 of 39
3/4/09 at 8:41am
Thread Starter 

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Well there was a slight rebound up to 45 a share.
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post #9 of 39
3/4/09 at 10:36am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I have used BB since they did away with late fees and I built my theater. So far I can not see anything that beats them for my use. About $20 per month for 3 @ a time unlimited rentals and 5 in store trade-ins. So realistically we watch 8-12 movies a month for the same price as buying 1-2 DVDs. As a result we only buy "must have" titles. I tried Netflix streaming and it has a long way to improve before I can watch a movie on my 720 projector. I for one hope BB pulls through.
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post #10 of 39
3/4/09 at 10:42am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I hardly ever rented. But, started using the Redbox when it came out. It's cheap and convenient.
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post #11 of 39
3/4/09 at 10:45am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Banks aren't the only things getting a "stress" test!
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post #12 of 39
3/4/09 at 3:43pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Banks aren't the only things getting a "stress" test!
And I bet there's more to come.
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post #13 of 39
3/4/09 at 4:27pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by gene c
And I bet there's more to come.
I'm sure you're right. According to an analysis by the chief economist at Business Week, nearly all of the domestic corporate profit growth for the decade 1997-2007 came from the financial sector. If that analysis is correct, then the rest of our business is in pretty poor shape.
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post #14 of 39
3/4/09 at 4:38pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Adam Lenhardt
This is the key point, I think. Dropping 77 percent in one day is still unusual, but it's hardly unique in this market.
It is? In one day? Unless you are using "unique" in its strict meaning, I would think that would be an extremely rare occurence, no?

--
H
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post #15 of 39
3/4/09 at 5:10pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by TonyD
Well there was a slight rebound up to 45 a share.
Well, whoever got in at .22 had a great day.

I just recently signed up for Netflix, just 7 years after considering it the first time. I like it better than BB. I haven't tried the streaming yet, but I don't have a PC hooked up to the projector, anyway.
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post #16 of 39
3/4/09 at 5:16pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Michael Reuben
I'm sure you're right. According to an analysis by the chief economist at Business Week, nearly all of the domestic corporate profit for the decade 1997-2007 came from the financial sector. If that analysis is correct, then the rest of our business is in pretty poor shape.
You mean profit growth, correct?

Bad shape indeed, since all that financial profit appears to be "fake."
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post #17 of 39
3/4/09 at 5:20pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Todd Hochard
You mean profit growth, correct?

Bad shape indeed, since all that financial profit appears to be "fake."
Did I drop a word? Argh, apparently so. Fixed.

You see? The news is so depressing I can't even manage a complex sentence accurately.
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post #18 of 39
3/4/09 at 8:33pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Not a good sign.

Don't follow the stock, but I believe they're on the NYSE. Once they're below $1.00 for six months, they can be delisted. They've essentially become a penny stock.

They lose credibility, trust, it's harder for the company to get credit, etc. It's considered pretty disgraceful to be delisted.

They may not necessarily end up bankrupt, but it's usually the beginning of the end.
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post #19 of 39
3/4/09 at 9:20pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Michael Reuben
According to an analysis by the chief economist at Business Week, nearly all of the domestic corporate profit growth for the decade 1997-2007 came from the financial sector. If that analysis is correct, then the rest of our business is in pretty poor shape.
I don't think it's a coincidence, therefore, that the Dow is floating around its 1997 levels right now. The market's factoring in a lot of phantom growth over the last decade.
Quote:
Originally Posted by Holadem
It is? In one day? Unless you are using "unique" in its strict meaning, I would think that would be an extremely rare occurence, no?
There are 2,773 listings on the New York Stock Exchange, and another 3,200 on the NASDAQ. If one out of every 60,000 stocks lost 77 percent of its value on a given day, it would still happen every two weeks or so. When you consider that the Dow has halved in value in less than two years and has been prone to wild fluctuations, you're in a climate where rapid sell-offs are more likely, albeit still very unlikely. When you further consider that Blockbuster is trading at less than $1, wild percentage fluctuations become more likely still. If the stock loses half its value tomorrow, it'll still have only lost ~$0.24 a share. If a company like GE (which has been hit pretty hard recently, too) lost $0.24 a share, it'd be off less than 4 percent.
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post #20 of 39
3/4/09 at 9:27pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I hope their not done. I just canceled my Netflix and signed on with Blockbuster. Netflix can't seem to get movies to me, all my queue says is "long wait" or "very long wait", I got tired of waiting.
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post #21 of 39
3/5/09 at 4:44am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I hope they can survive, too. Since getting into BluRay, we have started renting again and Blockbuster by far the most convenient store to our home. I really do not want another monthly subscription ala Netflix -- we have enough monthly bills, we do not rent enough to justify the fee, and usually rent on a whim.
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post #22 of 39
3/5/09 at 8:09am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
good riddance, they stink, I hope they rot in hell



I've seen stocks lose a high percentage of value and rebound within a week or so. On the other hand, it's a tough economic climate and we're beginning to really see which companies have a sturdy business model and which ones are run by a member of the Ministry of Silly Walks.

Personally, I wouldn't lose any sleep if they went out of business. I haven't been there in years and will never go again.

Oh, and by the way, good riddance, they stink, I hope they rot in hell.
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post #23 of 39
3/5/09 at 9:55am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I'd like to see Blockbuster survive. It's Movie Gallery I'd like to kick out of town. I can't understand how they're still in business in the current economy when they were struggling mightily back when things were still relatively stable.

And I agree that a 77% drop sounds like a lot, but when it only comes out to about 74 cents, it's not such a big thing (unless you own a bunch of the stock ).
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post #24 of 39
3/5/09 at 2:48pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by drobbins
I have used BB since they did away with late fees and I built my theater. So far I can not see anything that beats them for my use. About $20 per month for 3 @ a time unlimited rentals and 5 in store trade-ins. So realistically we watch 8-12 movies a month for the same price as buying 1-2 DVDs. As a result we only buy "must have" titles. I tried Netflix streaming and it has a long way to improve before I can watch a movie on my 720 projector. I for one hope BB pulls through.

I am on the same plan and I love it. We watch about the same amount of movies a month (8-12) and once a week I go to the BB that is 3 minutes from my house and let my kids pick out a movie. I really hope they stay open.

My Question -- Why doesn't a place like BB join forces with a cable or satellite company and offer new movies on the PPV channels. Maybe I am wrong but it always seems that the PPV channels are about 5 weeks behind the B&M stores.
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post #25 of 39
3/5/09 at 3:35pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Clinton McClure

Personally, I wouldn't lose any sleep if they went out of business. I haven't been there in years and will never go again.
I was that way with BB years ago, but so far they are much improved and beat out Netflix by far. You cannot beat the instore trade in, that is fantastic, no more "very long wait" comments in my queue like with Netflix.
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post #26 of 39
3/5/09 at 4:02pm
Thread Starter 

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

do you guys know the in store exchange was adjusted to
allow for no due date on the from the store rental.

anything you rent for free with the envelope will not have a due date.
your next movie in your Q will not be released until the in store dvd is returned to the store.
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post #27 of 39
3/5/09 at 4:16pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by Malcolm R
...

And I agree that a 77% drop sounds like a lot, but when it only comes out to about 74 cents, it's not such a big thing (unless you own a bunch of the stock ).
Actually it makes no difference if the drop is in cents or dollars.

For example, suppose you bought 100 shares of some blue-chip (if that term can still be used) at $96.00/share for a cost of (leaving aside commission, etc.) $96,000 and the stock is now selling at $22.00/share. So if you sell (again ignoring transaction costs) you realize $22,000, or a loss of $74,000 (77%).

Now make the same dollar investment purchasing $96,000 of Blockbuster stock (or 10,000 shares). The drop from 96 cents/share to 22 cents/share will result in the same dollar loss.

The price of each individual share makes no difference—it is the differential that counts. There is no reason to assume that any investor will decide to purchase only $1, or $10 or $100 dollars of stock because the price is low.
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post #28 of 39
3/5/09 at 4:21pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

I was with BlockBuster.com at one time. In one month, they raised their prices twice. I had unlimited in-store returns. Suddenly, without notice, if I wanted to keep the unlimited in-store returns, I had to buy the higher priced package. I told them to kiss my a$$, and I dropped them. I went with Netflix and like them much better.

I don't work a regular job, and am home most of the time. I used the online BB to get box sets and concerts (stuff not in the store). Then, on Tuesday morning, I'd go exchange the three I had, for three new releases. That worked out good. When I suddenly had only five in-store exchanges, that was a lot less than the 12 a month I was used to. I sent them an email, and told them if they weren't going to live up to the deal I signed up for, they could kiss.......... the place already mentioned. I've been in the store once since then, and rented a BD movie to watch at a friend's house, when he got a new tv and a BD player. If that's their usual way of doing business, it's no wonder they are in trouble. I hope they don't close though. They will come in handy occasionally.
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post #29 of 39
3/9/09 at 10:41am

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Quote:
Originally Posted by TonyD
do you guys know the in store exchange was adjusted to
allow for no due date on the from the store rental.

anything you rent for free with the envelope will not have a due date.
your next movie in your Q will not be released until the in store dvd is returned to the store.

I only noticed when nothing had been shipped for a few days, and having no DVDs to watch. Had I knew this more than a week ago, I would have never re-subscribed to Blockbuster.

Quote:
Originally Posted by Ed Moxley
I don't work a regular job, and am home most of the time. I used the online BB to get box sets and concerts (stuff not in the store). Then, on Tuesday morning, I'd go exchange the three I had, for three new releases. That worked out good. When I suddenly had only five in-store exchanges, that was a lot less than the 12 a month I was used to.

That would be the main reason why I would chose Blockbuster over Netflix. A faster exchange rate, which is a big deal to me when renting mainly TV shows. When I'm done with Disc 1, I could go to the store and exchange it for Disc 2. And Disc 3 would be delivered right away. No more now.
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post #30 of 39
3/13/09 at 1:45pm

Re: Is Blockbuster done, share price went down 77% in one day to 22 cents - 3/3/2009

Hmm...just got a notice telling me that I owe them about 10 bucks for a couple of movies that my wife rented and returned late a month or so ago...

I'll pay up and up their stock price for all you share holders...

R.
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