5 Strong Buy Stocks to Invest in Now According to Reddit

2. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 113

The Walt Disney Company (NYSE:DIS) operates as an entertainment company worldwide. Redditors observed that Disney+ only recently launched in most of the European Union at a reasonable price, while long-term subscribers of Netflix, Inc. (NASDAQ:NFLX) are giving up on their subscriptions due to the increasing fees. Additionally, the impact of COVID-19 on footfall in Disneyland and Parks is now very limited and the company has a bright future ahead, according to the Reddit community members. 

On July 26, Goldman Sachs analyst Brett Feldman reaffirmed a Buy rating on The Walt Disney Company (NYSE:DIS) but lowered the price target on the stock to $130 from $148. The analyst slashed linear TV advertising revenue estimates across his media coverage to account for a likely economic slowdown. The revisions are in line with the challenges the analyst projects based on the historical relationship between macroeconomic patterns and TV advertising.

Among the hedge funds tracked by Insider Monkey, David Goel and Paul Ferri’s Matrix Capital Management is the largest shareholder of the company, with 6.33 million shares worth $868.2 million. Overall, 113 hedge funds were bullish on The Walt Disney Company (NYSE:DIS) at the end of Q1 2022. 

Here is what Oakmark Fund has to say about The Walt Disney Company (NYSE:DIS) in its Q2 2022 investor letter:

“Disney (NYSE:DIS) is one of the most beloved consumer companies in the world. Its media business has a rich library of intellectual property, which provides a powerful engine for creating new content across the Disney, Pixar, Marvel, and Star Wars brands. This content also contributes to the success of Disney’s theme parks, which generated nearly half the company’s earnings and grew more than 10% annually in the decade prior to the pandemic. Shares have fallen nearly 50% over the past year as investors worried about the company’s ability to transition its media business to a direct-to-consumer streaming world. This transition has required management to make investments in its Disney+ streaming service that are depressing profitability today. However, we believe these investments will ultimately produce attractive returns as Disney+ continues to grow subscribers and increase pricing over time. As a result, we were able to purchase shares at a substantial discount to our estimate of intrinsic value.”