VGI Partners Global Investments Limited, an investment management company, released its 2022 annual investor letter. A copy of the same can be downloaded here. The firm returned -22.3% (net) for the year ended 31st December 2022. 2022 was a challenging year for the global equity market, the S&P 500 declined -19% during the period, the NASDAQ Composite retreated -33%, and the MSCI World Index fell -19% in the same period. In addition, please check the fund’s top five holdings to know its best picks in 2022.
VGI Partners highlighted stocks like The Walt Disney Company (NYSE:DIS) in the Q4 2022 investor letter. Headquartered in Burbank, California, The Walt Disney Company (NYSE:DIS) is an entertainment company. On March 31, 2023, The Walt Disney Company (NYSE:DIS) stock closed at $100.13 per share. One-month return of The Walt Disney Company (NYSE:DIS) was -0.53%, and its shares lost 27.75% of their value over the last 52 weeks. The Walt Disney Company (NYSE:DIS) has a market capitalization of $182.918 billion.
VGI Partners made the following comment about The Walt Disney Company (NYSE:DIS) in its 2022 annual investor letter:
“The Walt Disney Company (NYSE:DIS) is a diversified media conglomerate operating media networks, theme parks, film and TV studios and direct-to-consumer streaming services. It is the global leader in theme parks with hotels and cruise lines aimed at families. Key assets within Disney are the instantly recognisable entertainment franchises that have multiple avenues of monetisation such as Mickey Mouse, Star Wars, ABC and Marvel’s Avengers.
Disney’s share price declined due to a number of factors in 2022, presenting us the chance to purchase a long-admired business and its unique collection of valuable intellectual property assets at what we consider to be a very attractive valuation. Summarily, the EPS of Disney has declined from US$7 in 2018 to ~US$2.60 in 2022 but we believe that the earnings power of the assets has not diminished to anywhere near this extent.
Disney is currently undergoing a business transition within the Media and Entertainment Distribution division (DMED) from traditional media property distribution via third parties (i.e. cinemas and broadcast networks) to a Direct-To-Consumer (DTC) model via the Disney+ streaming service. A key element of our thesis is that the earnings power of the company is currently being masked by the marketing and content investments within Disney+ and that this will normalise over the next several years. To put this in perspective, Disney+ (DTC sub-segment) currently generates operating losses of over US$3.3bn (a negative 14% operating margin) compared to operating margins at its nearest streaming competitor, Netflix, of +15.5%…” (Click here to read the full text)
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The Walt Disney Company (NYSE:DIS) is in 12th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 99 hedge fund portfolios held The Walt Disney Company (NYSE:DIS) at the end of the fourth quarter which was 112 in the previous quarter.
We discussed The Walt Disney Company (NYSE:DIS) in another article and shared the list of best growth stocks to buy for the next 5 years. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
