Disney Finding its Way into Digital Streaming Age...A Buy !

Disney has been in the eye of the storm in 2020 whereby movie theaters, sports entertainment media networks and it’s parks business which all are cornerstones for Disney business model have remained in a relatively fragile early recovery stage. Disney +; the online streaming platform that has been rolled out at the end of 2019 is proving to be a huge success. Disney+ has already clocked 60 Million plus subscribers whereas across its various streaming platform including Disney +, ESPN + and Hulu, the Company has recorded a subscription base of 100 MM. Compared to its direct rival in streaming services Netflix, Disney has the clear advantage of content. It is often said that in streaming business “content is King” and in terms of content there is only one winner and King here… “Disney”! Given that Netflix pays a very high cost for acquiring new content and has a staggering P/E of 83.3. Compared to this, Disney’s P/E ratio had averaged between 15x to 17x over the last one year before covid-19 took hold. Identifying the paradigm shift in industry towards streaming platforms, Disney is progressively making moves to shift its business model towards streaming! Disney with its content (movie productions and shows for people of all ages) and with is existing growing base of online viewership (currently 100 Million plus) has a distinct advantage. The Company is in pole position to become a leader in digital streaming services. It’s only a matter of time before investors realize this and start valuing the Company from this angle and start associating higher P/E with this business!

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Disney Finding its Way into Digital Streaming Age...A Buy !

Sep 19, 2020

bullish

general Analysis

[1 min Read]

blog post cover photo

Photo by: Jason Jarrach

Disney has been in the eye of the storm in 2020 whereby movie theaters, sports entertainment media networks and it’s parks business which all are cornerstones for Disney business model have remained in a relatively fragile early recovery stage. Disney +; the online streaming platform that has been rolled out at the end of 2019 is proving to be a huge success. Disney+ has already clocked 60 Million plus subscribers whereas across its various streaming platform including Disney +, ESPN + and Hulu, the Company has recorded a subscription base of 100 MM. Compared to its direct rival in streaming services Netflix, Disney has the clear advantage of content. It is often said that in streaming business “content is King” and in terms of content there is only one winner and King here… “Disney”! Given that Netflix pays a very high cost for acquiring new content and has a staggering P/E of 83.3. Compared to this, Disney’s P/E ratio had averaged between 15x to 17x over the last one year before covid-19 took hold. Identifying the paradigm shift in industry towards streaming platforms, Disney is progressively making moves to shift its business model towards streaming! Disney with its content (movie productions and shows for people of all ages) and with is existing growing base of online viewership (currently 100 Million plus) has a distinct advantage. The Company is in pole position to become a leader in digital streaming services. It’s only a matter of time before investors realize this and start valuing the Company from this angle and start associating higher P/E with this business!
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DIS

The Walt Disney Company

96.56

2.62
2.71%

Return

-24.94%
Change % Since Posting
-32.07
Change Since Posting
128.63
Price When Posted

Metrics

170.00
Target Price
9/ 10
Confidence
1-2 Weeks
Timeframe
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