Stocks Under $1: Blockbuster, RHI Entertainment, PokerTek (BBI, PTEK, RHIE)

What do RHI Entertainment (NASDAQ:RHIE), PokerTek Inc. (NASDAQ:PTEK) and Blockbuster Inc. (NYSE:BBI) have in common?  All three companies' shares are now trading under $1, in fact they are in the 70 Cent range.  Are these stocks just waiting to become Penny Stocks or is there any hope for a major comeback?

RHI Entertainment, Inc. (NASDAQ:RHIE)  - Closed Friday (11/20) at 73 Cents.
RHI Entertainment, Inc. (RHIE) has fallen 91% in 2009, after shares fell off a cliff in January they never recovered and this past month its really gotten ugly.  RHIE shares started this year in the $9 range by March they were just above $1 and earlier this month they made it back to just under $3. 

Last week RHI Entertainment (RHIE) hit 75 Cents a share and lost 72% of their holdings after the company reported a net loss for the third quarter of $16.7 million or $1.24 per share, in comparison with a net loss of $3.5 million or $0.26 per share in the same quarter a year-ago.

RHI's quarterly total revenue fell to $9.5 million from $53.5 million in the year-ago quarter. On average, analysts polled by Thomson Reuters expected the company to report a loss of $0.22 per share on revenue of $51.07 million. Analysts' estimates typically exclude special items.  Falling knife alert continues on RHI Entertainment, Inc. (RHIE), please use caution. 

PokerTek, Inc. (NASDAQ:PTEK)  - Closed Friday (11/20) at 76 Cents.
PokerTek (PTEK) has fallen 41% in 2009 and since September shares are down 33% and can't get back to the $1 level.  PokerTek is now down to a market cap of just $8.38 million.

November has been a tough month for PokerTek, the maker of the electronic poker table and Heads-Up Challenge video game Q3 revenue fell 64% to $1.6 million in 2009 compared to its Q3 2008 figures.The overall revenue figure for the first nine months of 2009 was $5.2 million which shows a drop of 54% from 2008.

Chief Executive and Chief Financial Officer, Mark Roberson said in response to the quarter:
“Our goals entering the third quarter were aimed squarely at driving our expenses lower and strengthening our balance sheet. With clear progress in these areas, we now look forward to shifting focus from cost reduction to revenue growth.”

Fellow investors, RHI Entertainment and PokerTek are hurting, they are in danger of being de-listed from the major exchanges if they don't get back above $1.  At some point they may become acquisition targets, both RHI and PokerTek stand a chance of surviving, the next player may not be so lucky.

Last but not least is Blockbuster Inc. (NYSE:BBI) - Closed Friday (11/20) at 74 Cents.
In the last 5 years Blockbuster has lost its business to Netflix (NASDAQ:NFLX) and its stock has dropped 90%. Consumers are done with the be-kind rewind days and Wall Street is losing its love for BBI shares.

Wow what a difference! Blockbuster (NYSE: BBI) posted a third-quarter net loss of $116.8 million this month compared to a net loss of $20.6 million, or 11 cents per share during the same quarter last year. The company attributes its deeper net loss to a write-off on debt financing tied to expenses associated with the company’s refinancing of the sale of its Irish subsidiary, Xtra-vision Limited.

The company's sales also fell 21%, partly due to a drop in same-store sales--or sales at stores open for 12 months or more -- and because of the closing of stores and the impact of foreign currency exchanges, the company said.

In the third quarter, Blockbuster recorded $910.5 million in sales, down from $1.15 billion a year earlier. Gone are the days when Blockbuster ruled the home entertainment option, you don't have to rent the VCR and tapes, all you need is the ability to download (thank you Netflix).

RHI Entertainment (NASDAQ:RHIE), PokerTek Inc. (NASDAQ:PTEK) and Blockbuster Inc. (NYSE:BBI) are now trading in the 70 Cent range, which company will survive and which company will bite the dust -- place your bets.

Disclaimer: No positions in any of the securities mentioned in this publication.