In this piece, we’ll take a look at the 5 Best Streaming and TV Stocks To Buy Now. For a detailed analysis of the industry and more stocks, go to 12 Best Streaming and TV Stocks To Buy Now.
5. Disney+ by The Walt Disney Company (NYSE:DIS)
Number of Hedge Funds In Q2 2023: 92
In the second quarter of 2023, according to our database, a total of 92 hedge funds demonstrated their confidence in The Walt Disney Company (NYSE:DIS), collectively holding a substantial stake with a total value of $2.2 billion.
The Walt Disney Company’s Disney+ is one of the most successful streaming services in the US. Its launch time of November, 2019 is often regarded as a shrewed business decision because of the momentum that MCU content had at the conclusion of Phase 3, which included movies like Infinity War and Endgame. Many of these were some of the highest grossing movies of all time.
The launch of Disney+ saw multiple spinoffs for characters from Phase 3, which included shows like WandaVision, The Falcon and the Winter Soldier and Loki, among a number of others. These shows kept marvel fans on the hook and resulted in Disney+ rapidly gaining high subscription numbers. However, as of late, the subscriber count has fell to 146 million.
On September 20, 2023, analyst Barton Crockett of Rosenblatt made an unconventional move regarding Walt Disney (NYSE:DIS). Despite Disney’s recent stock price decline, which marked its lowest point in more than three years, Crockett opted to retain a Buy rating on the company. Nevertheless, he did revise down the price target slightly, reducing it from $104 to $103. Crockett’s confidence in Disney is rooted in his conviction that the company’s asset value remains fundamentally strong.
However, as of September 6, 2023, the stock of The Walt Disney Company (NYSE:DIS) concluded trading at $80.98 per share. Over the course of the past month, the stock displayed a one-month return of -7.44%, and its overall performance over the past year reflected a decline of 28.14% in share value. Currently, The Walt Disney Company (NYSE:DIS) currently has a market capitalization of $148.176 billion.
In its Q2 2023 investor letter, Diamond Hill Large Cap Strategy provided the following commentary regarding The Walt Disney Company (NYSE:DIS):
“Our bottom contributors in Q2 included health insurance company Humana, biopharmaceutical company Pfizer and global entertainment company The Walt Disney Company (NYSE:DIS). Disney’s Bob Iger returned to the CEO’s seat in November 2022, replacing Bob Chapek, who left following a turbulent tenure. As a result of disappointing quarterly results and incremental commentary suggesting a more inline strategy with other media, the market has become less confident that Iger will achieve a turnaround by the end of his 1.5- year contract. We continue to believe Disney has a unique collection of assets and owns some of the best content among all media companies. Their ability to monetize this content across many platforms — studio, theme park, toys, streaming — is incredibly valuable; thus we remain investors.”
4. Netflix, Inc (NASDAQ:NFLX)
Number of Hedge Funds In Q2 2023: 114
Netflix, Inc (NASDAQ:NFLX) is an American subscription video-on-demand over-the-top streaming service that primarily distributes films and television series produced by the media company of the same name from various countries.
On August 25, 2023, Alan Gould, an analyst at Loop Capital, upgraded the stock from ‘Hold’ to ‘Buy’ and increased his price target to $500. This upgrade is underpinned by improved fundamentals and compelling valuation as catalysts. Gould highlighted Netflix’s potential to thrive amid increasing competition, where many of its competitors are raising prices for their streaming services while reducing spending on content.
Netflix’s robust content pipeline and global production capabilities position it as one of the most resilient players in the media industry, particularly in the face of ongoing writer and actor strikes. Gould believes that the growing popularity of streaming and the decline of traditional TV may further enhance Netflix’s growth prospects.
According to Insider Monkey’s database, in the second quarter of 2023, a total of 114 hedge funds had stake in Netflix, Inc (NASDAQ:NFLX), showcasing continued investor interest in the streaming giant. Among these, Eagle Capital Management held the largest share, valued at an impressive $1.49 billion.
3. Apple TV+ by Apple Inc. (NASDAQ:AAPL)
Number of Hedge Funds In Q2 2023: 135
Apple Inc. (NASDAQ:AAPL) is heavily investing in original content production for its streaming platform, Apple TV+. However, uncertainty lingers about the long-term viability of this strategy. Specific financial data for TV+ remains undisclosed, prompting industry analysts to offer estimates. According to Barclays analyst Tim Long, TV+ currently constitutes around 2% of Apple’s services revenue, with estimated 2022 revenue of $1.5 billion, projected to rise to $2.2 billion in 2023. Notably, Apple’s total services revenue for the fiscal year ending in September 2022 was $78 billion.
Long suggests that TV+ likely operates with negative profit margins, resulting in an estimated loss of approximately 30 cents per share in 2022. These losses are anticipated to persist until 2025 due to substantial content investment, totaling $4.8 billion in 2022, $5.8 billion in 2023, and $6.6 billion in the following year.
Nevertheless, there is optimism regarding potential growth. Long indicates that TV+ is experiencing rapid annual revenue growth of approximately 30%, surpassing the industry’s typical growth rate of around 10%. In 2023, a 52% revenue increase is projected, partly attributed to a subscription price increase from $4.99 to $6.99 per month in October 2022.
Furthermore, Apple’s venture into sports content, including exclusive deals with Major League Soccer and broadcasting rights for Friday night Major League Baseball games, may pave the way for future advertising opportunities on TV+, potentially generating significant revenue for the platform.
2. Google TV by Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Funds In Q2 2023: 204
Alphabet Inc. (NASDAQ:GOOGL) is a massive and highly successful tech company known for Google, which is its primary business. Google’s search engine is the most popular one globally. Besides that, they offer various services like email, online storage, maps, ads, and hardware products. Google TV is a platform for watching TV shows and movies on smart TVs and streaming devices.
In April 2023, Google announced a strategic move to enhance its Google TV software by introducing over 800 free channels. This expansion is being integrated into the Chromecast streaming device and select television models manufactured by Sony, CL, Hisense, and Philips. The initiative involves aggregating numerous existing free TV services, including Fox’s Tubi, Paramount Global’s Pluto TV, and Haystack News, within the Google TV platform. This move serves to distinguish Google’s streaming interface from competitors such as Roku, Apple, and Amazon, and may entice individuals who prefer not to subscribe to paid streaming services. This service rollout is initially focused on the U.S. market.
On August 31, 2023, Bank of America (BofA) increased its target price for Alphabet Inc. (NASDAQ:GOOGL) stock from $142 to $146 and recommended buying the shares. According to data from Insider Monkey, as of the end of the second quarter of 2023, 204 hedge funds had invested in Alphabet Inc. (NASDAQ:GOOGL). This shows that many big investors believe in Alphabet’s future success in the tech world.
1. Prime Video by Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Funds In Q2 2023: 278
Prime Video by Amazon is the 2nd biggest streaming platform, with over 200 million subscribers, after Netflix, which has 238 million subscribers.
On September 13, 2023, Morgan Stanley analyst Brian Nowak had an “Overweight” rating for Amazon and maintained a price target of $175.00. Furthermore, as of the second quarter of 2023, data from Insider Monkey reveals that a notable 278 out of 910 hedge funds had stakes in Amazon.com, Inc. (NASDAQ:AMZN).
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