Over the past few weeks Disney’s stock price has been doing great. In fact, we’ve posted about it several times here at The DisInsider. Good news about Covid-19 vaccines have buoyed the stock on a seemingly weekly basis. This, coupled with impressive Disney+ subscriber counts, has not only kept the DIS stock above water, but allowed it to set new company records. Then came yesterday’s investor day presentation, which managed to take an old, strong, and reliable company and make it look young, fresh, and full of future potential. Not an easy task for a company pushing 100 years old.
As expected, Wall Street fell in love all over again and responded with an earth shattering hug in the form of a $20+ dollar jump in stock price. Which translates roughly to a 14% increase. As of 11:18AM PST, with roughly 90 minutes left of trading, Disney’s stock sits at $178.37 a share, down slightly from its $179.44 high a couple of minutes ago.
For some perspective, outside of this past week, Disney’s stock had only been in the low $150s once and that was one year ago. This past spring, when Covid-19 was just getting started, Disney’s stock dropped to less than half of today’s high. What does all of this mean? Wall Street analysts and investors are VERY happy with what they are seeing for Disney’s future.
Here is another reason why this is a big deal. Disney is nearly 100 years old, it is reliable, it is big, it is well known, and it is strong. What that typically means is that it moves at a glacial pace. It has often been a stock that you invest in for a slow, but safe, investment. This is what happens with these century old businesses. They aren’t going to make you rich overnight, but you also won’t lose your money overnight. But, Disney’s CEO Bob Chapek, along with Chairman Bob Iger, have done the impossible, turned this behemoth into a “growth stock” and now Wall Street is looking at the company with the enthusiasm they would normally save for a hot up and comer.
It’s like the classic dating dichotomy. Disney was always the stock you would take home to meet your parents. Reliable, kind, and supportive, but lacking a bit of edge and excitement. All of these new startups with flashy IPOs are the bad-boy, motorcycle riding, tattooed partner that you sneak out of your boring date to go see secretly. They will rock your world, but, the whole time you know they could break your heart.
Somehow Disney has managed to take off its glasses and throw some product in their hair and become the exciting bad boy after decades of being the safe bet. By entering the streaming market in the way that it did, Disney’s growth potential knows no bounds. But it also maintains the safety and reliability that most growth stocks are missing, because of their unmatched theme parks (Disneyland, Walt Disney World, Disneyland Parish, Shanghai Disney, Hong Kong Disneyland, and Tokyo Disney), their cruise lines, their products, and their live theater offerings. These are the bedrock of the company that will drive the motor to keep this ship afloat while the bad boys over at streaming open up the door to a world of possibility.
The future is unbelievably bight for the Walt Disney Company. With the news that the Pfizer vaccine is all but assured to be approved later today and Moderna’s vaccine following closely behind, the light at the end of the covid-19 tunnel is starting to shine, which means only good things for Disney’s parks, experiences and products. Disney has an unmatched slate of new content in production and has international expansion of their streaming service the likes of which Netflix and HBOMax could only dream about.
There is often a lot of debate about what Walt Disney would want to see with the company he created nearly a century ago, but many people forget that his brother Roy O. Disney managed the company’s finances and truly made Walt’s creative dream a reality through innovate and creative business strategies. While we can argue what the creative-minded Walt would think about the direction of the current Disney company, there is no question that the business savvy Roy O. Disney would be very impressed with where the company is today.
We follow all aspects of the Disney company here at The DisInsider, so keep checking back so you don’t miss any of the news.
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