3) The Walt Disney Company (NYSE:DIS)
Stock Price as of November 6: $98.89
Number of Hedge Fund Holders: 92
The Walt Disney Company (NYSE:DIS) operates as an entertainment company. The company has 3 segments: Entertainment, Sports, and Experiences.
The Walt Disney Company (NYSE:DIS)’s portfolio of treasured brands such as Marvel, ESPN, Lucasfilm, and Pixar provides it with a competitive edge. These assets should help the company remain at the forefront of the broader entertainment world. Despite the short-term challenges, the long-term outlook for The Walt Disney Company (NYSE:DIS)’s parks remains positive. The company’s streaming services, mainly Disney+ and Hulu, are the focal point for growth. Hulu’s content strategy, which allows for a higher ad load, offers the company an advantage in the connected TV (CTV) space.
The Walt Disney Company (NYSE:DIS)’s future growth prospects are strong, courtesy of its diversified business model and healthy brand recognition. Its ability to leverage a broad range of assets and media channels should help it navigate a challenging business environment. The company’s diverse portfolio of assets throughout theme parks, streaming services, media networks, and consumer products offers multiple avenues for growth. The synergies between these divisions enable The Walt Disney Company (NYSE:DIS) to cross-promote and leverage intellectual property throughout various platforms.
The company’s key strengths include strong brand recognition, robust intellectual property, and a content library. Considering its strong presence in streaming via Disney+ and Hulu, The Walt Disney Company (NYSE:DIS) remains well-positioned to capture an increasing share of the digital advertising market. Disney’s rich first-party data through its various platforms can be leveraged to provide targeted advertising solutions. This can help it command premium rates from advertisers.
As per Wall Street analysts, the shares of The Walt Disney Company (NYSE:DIS) have an average price target of $112.47. Meridian Funds, managed by ArrowMark Partners, released its second quarter 2024 investor letter. Here is what the fund said:
“The Walt Disney Company (NYSE:DIS) operates a diversified entertainment business with theme parks, media networks, and streaming services. We own Disney because we believe its strong brand, valuable IP, and expanding streaming offerings will drive sustainable long-term growth. The company’s stock, however, underperformed in the quarter due to concerns about a slowdown in growth at its theme park division. While park revenue still grew by 10% year-over-year, management’s commentary suggested a moderation in post-pandemic demand and rising costs, leading to a disappointing outlook for park operating income in the second half of the year. This overshadowed the positive news that the company’s streaming segment, driven by strong subscriber growth at Disney+, reached profitability ahead of schedule. We held our position and will continue to monitor the performance of the theme park division.”
