HOLLYWOOD — Sumner Redstone’s Viacom has dished out $2.3 million to snap up 113,700 shares in Viacom subsidiary Blockbuster Entertainment amid a surge of interest in homevid stocks.
A spokeswoman said the stock purchases are of the sort Viacom makes from time to time to keep its stake in Blockbuster at 80%.
Blockbuster has enjoyed several analyst upgrades recently (Daily Variety, Aug. 26). And on Thursday, Morgan Keegan analyst Robert DeLean initiated coverage of the stock with an “outperform” rating.
Viacom filed regulatory documents indicating that it purchased several blocks of Blockbuster shares Wednesday and Thursday. The purchases were made in the area of the stock’s recent trading price, which has hovered just above $20 the past couple of sessions.
Sector enthusiasm is tied to a slew of big titles set to hit homevid shelves in coming months. Riding the bullishness, Blockbuster shares have risen above their 52-week trading average over the past couple of weeks.
On Thursday, the shares rose 11¢ to $20.27. The stock’s 52-week high dates back to $26.33 on Oct. 14; the 52-week low is $12.15 on Dec. 24.
On Monday, Smith Barney analyst Jill Krutick raised the investment firm’s target price for Blockbuster to $22 from $18.
Viacom shares rose 18¢ to $43.75 on Thursday.