10 Best Wide Moat Stocks to Invest In

6) The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 76

The Walt Disney Company (NYSE:DIS) operates as an entertainment company. The intangible assets aiding the company’s wide moat consist of the intellectual property behind franchises and characters.  Since it has numerous touchpoints, The Walt Disney Company (NYSE:DIS) is well-placed to monetize this IP in numerous ways i.e., at the box office, at a theme park, cruise, or home TV. The company’s franchises continue to endure and entertain generations, providing stable revenue opportunities. Next, its streaming services, parks, and gaming tend to offer diversification.

Analyst David Karnovsky from JP Morgan maintained a “Buy” rating on the company’s stock, providing a price target of $128.00. The analyst’s rating stems from a variety of factors such as The Walt Disney Company (NYSE:DIS)’s unique content and improving streaming financials. Furthermore, the integration of Hulu and ESPN on Disney+ continues to be recognized by marketers, consumers, and investors. As per the analyst, ESPN Flagship offers an under-appreciated opportunity for revenue growth.

The Walt Disney Company (NYSE:DIS)’s parks and experiences segment can see sustained operating income growth, courtesy of committed capex on new attractions and cruises, says Karnovsky.  Meridian Funds, managed by ArrowMark Partners, released its Q2 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.”