Disney’s Poor Stock Performance

 by Ray Keating

Analysis

DisneyBizJournal.com

July 18, 2024

 

There’s been a good deal of talk about the underperformance of The Walt Disney Company’s stock. Since Disney is a company that seems to get a great deal of criticism – sometimes for good reason and many times without a sound basis – DisneyBizJournal has been overdue in taking a look at the Disney stock over the long haul.

 

It's standard practice to see how a stock performs compared to the market overall. The following chart comes courtesy of PortfoliosLab.com, and it compares the Disney stock price (DIS) versus the S&P 500 Index (as captured by SPDR S&P 500 ETF (SPY)). By the way, these prices are adjusted for stock splits and dividends.

The chart goes back ten years. From July 2014 to March 2021, Disney’s stock largely went along with the S&P 500. However, since March 2021, the divergence has been stunning, with the market climbing higher and Disney declining. Over this ten-year period, as PortfoliosLab noted, “DIS has underperformed SPY with an annualized return of 2.19%, while SPY has yielded a comparatively higher 12.93% annualized return.”

 

Over the past five years (see the first chart below from PortfoliosLab.com), the S&P 500 gained 102.8 percent, while Disney declined by 29.5 percent. And over the past year, the S&P was up by 24.1 percent, with Disney experiencing a gain of 12.7 percent (the second chart is below).

Finally, what about stock performance since Bob Iger returned as CEO on November 20, 2022? The S&P has been up 40.5 percent, while Disney’s down by 34 percent.

 

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Ray Keating is the editor, publisher and economist for DisneyBizJournal.com; and author of the Pastor Stephen Grant thrillers and mysteries, the Alliance of Saint Michael novels, and assorted nonfiction books. Have Ray Keating speak your group, business, school, church, or organization. Email him at raykeating@keatingreports.com.

 

The views expressed here are his own – after all, no one else should be held responsible for this stuff, right? Keating also own stock in Disney.

 

The Disney Planner: The TO DO List Solution combines a simple, powerful system for getting things done with encouragement and fun for Disney fans, including those who love Mickey, Marvel, Star Wars, Indiana Jones, Pixar, princesses and more.

 

Never miss any new book by Ray Keating by joining the Pastor Stephen Grant Fellowship with Ray Keating at

https://www.patreon.com/pastorstephengrantfellowship.

 

Various books by Ray Keating…

 

• The Pastor Stephen Grant thrillers and mysteries. There are 19 books in the series now.

 

• The Alliance of Saint Michael novels – Cathedral and Subversion – are at Amazon. 

 

• Order The Weekly Economist III: Another 52 Quick Reads to Help You Think Like an Economist, The Weekly Economist II: 52 More Quick Reads to Help You Think Like an Economist, and The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist at Amazon.com.

 

• Signed editions of Ray’s books are at www.raykeatingbooksandmore.com. 

 

Also, check out Ray’s podcasts – the Daily Dose of Disney, Free Enterprise in Three Minutes, and the PRESS CLUB C Podcast.

Why Did Disney’s Stock Dive on Friday (Jan. 21)?

 by Ray Keating

Analysis

DisneyBizJournal.com

January 22, 2022

 

Disney’s stock price dropped by $10.24 – or by 6.94 percent – on Friday, January 21, to $137.38. That was the worst closing price for a week since early November 2020. (Full disclosure: I own Disney stock.)

 

So, what happened? Netflix happened.

Specifically, Netflix missed on market expectations for subscriber growth. The company projected subscriber growth of 2.5 million in the current quarter (first quarter 2022), which compares to 4 million in the same quarter last year. Also, subscribers came in at 8.3 million in the fourth quarter, slightly below projections of 8.5 million. Netflix tumbled by 22 percent on Friday.

 

Of course, Disney also had missed market expectations for Disney+ subscriber growth that was announced in November, with 2.1 million quarterly net adds coming in far below market expectations that topped 10 million. And since early November, the Disney stock price has dropped by nearly $40 per share, or by 22 percent.

 

Having said all of this, Disney differs from Netflix in that it is not only a streaming play. While CEO Bob Chapek has made it clear that Disney’s main emphasis moving forward will in fact be direct-to-consumer, streaming efforts, that doesn’t mean that the rest of this vast entertainment company, such as theme parks, the cruise line, resorts, merchandise, and so on, will somehow be neglected. Indeed, since the days of Walt Disney himself, Disney has been known for brand synergy, with one part of the company fueling growth and revenues in other parts. 

 

Given the various sectors covered by Disney, few entertainment companies seem better positioned to take full advantage of a post-pandemic, post-supply-chain-challenges, post-inflation environment. The only real question is the same one that all other businesses are trying to continue to figure out: Just when exactly will we be clear of this pandemic and its related problems?

 

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Ray Keating is the editor, publisher and economist for DisneyBizJournal.com, and author of the Pastor Stephen Grant novels and assorted nonfiction books. Have Ray Keating speak your group, business, school, church, or organization. Email him at raykeating@keatingreports.com.

 

The views expressed here are his own – after all, no one else should be held responsible for this stuff, right?

 

Get more out of 2022 with The Disney Planner 2022: The TO DO List Solution! It combines a simple, powerful system for getting things done with encouragement and fun for Disney fans, including those who love Mickey, Marvel, Star Wars, Indiana Jones, Pixar, princesses and more. Also, “The Disney Planner 2022: The TO DO List Solution” comes with a handy spiral binding for easy use. 

 

Keating has three new books out. Vatican Shadows: A Pastor Stephen Grant Novel is the 13^th thriller/mystery in the Pastor Stephen Grant series. Get the paperback or Kindle edition at Amazon, or signed books at www.raykeatingonline.com. Past Lives: A Pastor Stephen Grant Short Story is the 14th book in the series. Again, get the paperback or Kindle edition at Amazon, or signed book at www.raykeatingonline.com. And order the 15th book in the series What’s Lost? A Pastor Stephen Grant Short Story – grab it at Amazon.com or signed editions at www.raykeatingonline.com. 

 

Also, check out Ray’s podcasts – the Daily Dose of Disney, Free Enterprise in Three Minutes, and the PRESS CLUB C Podcast.

Will Disney Shareholders’ Monday Morning Blues Last?

 by Ray Keating

Analysis

DisneyBizJournal.com

October 19, 2021

 

Disney shareholders heard some unusual Monday morning (October 18) blues this week.

 

First, Disney’s stock received a rare downgrade from a Barclays analyst, going from a price target of $210 per share to $175 per share.

The big worry for this analyst was the slowdown in Disney+ streaming subscribers.  (See DisneyBizJournal’s report on Disney’s latest announcements on streaming.) As Reuters noted:

 

     “While the company (Disney) appears to be targeting one new piece of content a week, not every piece of content has the same franchise value or visibility,” Barclays analyst Kannan Venkateshwar said.

     Barclays also said the slowdown in Disney+ subscribers could not be solely attributed to a pull forward in additions in 2020, when streaming platforms gained popularity as people hunkering down at home sought entertainment.

     To achieve its target of 230 million to 260 million Disney+ subscribers by the end of fiscal 2024, Disney will need to more than double its current pace of growth to at least the same level as Netflix (NFLX.O), according to Barclays.

 

For good measure, shareholders and movie fans were hit on Monday morning with a long list of movie releases being pushed back by Disney. 

 

“Indiana Jones 5” was delayed, again, being moved from July 29, 2022, to June 30, 2023. Keep in mind that this fifth installment in the Indiana Jones saga was originally supposed to be released in 2019. 

 

As for the Marvel Cinematic Universe:

 

• Doctor Strange in the Multiverse of Madness moves from March 25, 2022, to May 6, 2022. 

 

• Thor: Love and Thunder will journey from May 6, 2022, to July 8, 2022.

 

• Black Panther: Wakanda Forever goes from July 8, 2022, to November 11, 2022.

 

• The Marvels shifts from November 11, 2022, to February 17, 2023. 

 

• Ant-Man and the Wasp: Quantumania shifts from February 17, 2023, to July 28, 2023. 

 

• Also, an untitled Marvel movie is being shifted forward from November 10, 2023, to November 3, 2023.  

 

Assorted untitled films also were removed from the schedule.

 

Meanwhile, on the MCU slate before Doctor Strange are Eternals on November 5, 2021, and Spider-Man: No Way Home (with Sony) on December 17, 2021.

 

So, does all of this information warrant longer-run concerns for Disney and its stock? Not really. 

 

The schedule pushbacks on movies should have surprised no one, as Disney and the rest of Hollywood still work to sort out the (hopefully) post-pandemic world of movie releases. Also, a slowing in subscriber growth for Disney+ was predictable, but reaching the subscriber goal of exceeding 230 million by the end of fiscal year 2024 remains well within reasonable expectations. That effort, of course, will be helped by more streaming content, especially of the Star Wars and Marvel varieties, coming to Disney+.

 

The Walt Disney Company’s stock price closed on October 19 at $171.18.

 

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Ray Keating is the editor, publisher and economist for DisneyBizJournal.com, and author of the Pastor Stephen Grant novels and assorted nonfiction books. Have Ray Keating speak your group, business, school, church, or organization. Email him at raykeating@keatingreports.com.

 

The views expressed here are his own – after all, no one else should be held responsible for this stuff, right?

 

Keating has three new books out. Vatican Shadows: A Pastor Stephen Grant Novel is the 13ththriller/mystery in the Pastor Stephen Grant series. Get the paperback or Kindle edition at Amazon, or signed books at www.raykeatingonline.com. Past Lives: A Pastor Stephen Grant Short Story is the 14th book in the series. Again, get the paperback or Kindle edition at Amazon, or signed book at www.raykeatingonline.com. And order the 15th book in the series What’s Lost? A Pastor Stephen Grant Short Story – grab it at Amazon.com or signed editions at www.raykeatingonline.com. 

 

Also, check out Ray’s podcasts – the Daily Dose of Disney, Free Enterprise in Three Minutes, and the PRESS CLUB C Podcast.

 

You also can order his book Behind Enemy Lines: Conservative Communiques from Left-Wing New York  from Amazon or signed books  at RayKeatingOnline.com. His other recent nonfiction book is Free Trade Rocks! 10 Points on International Trade Everyone Should Know. 

 

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