Focusing on Profits
1. The new business plan of selling off unprofitable stores and
non-core assets is working. Look at the recent Rhino chain sale,
closure of unprofitable stores, etc.

It's showing up in the numbers too: $130 million free cash flow
generated in first 9 months of 2006. $150 million of debt paid down.
When you generate tons of FCF and pay down tons of debt, that's a sign
of a healthier business.

Insider Buying
2. Then you see the CEO recently buying 220,000 shares at $4.66. CEO's
don't put up over $1 million of their personal capital for charity.
Usually that's also a great sign business trends are looking good.

Growth Catalyst - Can you say Total Access?
3. Right-sizing the business to focus on profits is all well and fine,
but companies don't ramp unless they have a growth catalyst. In Sept.
qter, BBI had 1.5M subs with a net add of 150k in the qter. BBI just
announced 2.2m subs with a net add of 500k. The new Total Access
program is WORKING. The numbers show BBI is taking huge share and
customers LOVE the Total Access value proposition. I tried it, it's
GREAT.

Market Cynicism
4. Often the big money is made being a contrarian when the general
market holds negative feelings toward a company that is stale and of
the past. This happened with Kmart/Sears, when everyone continue to
bash it when business was clearly turning thanks to Lampert's focus on
FCF and profits. Well it's happening to BBI as not a day goes by
without people bashing it for its past. According to Yahoo Finance, 28%
of the float is short. Ouch! What's going to happen when BBI puts up
huge FCF over next few quarters and Total Access continues to ramp?

For the skeptics, before you bash, do the work. Read the last 10Q, see
the big FCF y/y comparisons, look at the membership ramp in Total
Access 150k to 500k a quarter, etc. The numbers don't lie.

I couldn't agree more; Although, Blockbuster has suffered from poor
management in the past, it seem like they know what they are doing now
and I really think that it 's a great time to invest in BBI.

Say no more!