My previous commentary on what I perceived to be an excellent investment by The Walt Disney Co. (NYSE:DIS) in the streaming space with the company’s newly-launched Disney+ platform now is one of the key pillars supporting this entertainment giant.
The company’s stock price has been hit very hard by the coronavirus outbreak, particularly due to park closures and lost blockbuster film revenue from Disney’s blue-chip portfolio of brands. Perhaps one of Disney’s core strengths is having a highly tangible portfolio of brands which often inspire its consumer base to engage, and spend money while doing so. Unfortunately, this strength has become a key weakness for the business, with in-home entertainment one of the few sectors left which is poised to see any sort of meaningful near-term growth.
The Disney+ subscriber base is only likely to grow globally, in my view, as consumers look for low-cost entertainment options in the safety of their own homes. I would expect to see additional investment from Disney into its streaming technology to support subscriber and revenue growth to offset some obvious shortfalls which are set to emerge in a number of other core business from Disney.
The true value of Disney’s stock really depends on how far out one expects the coronavirus to impact earnings. But at these levels, the company looks like a steal from the perspective of a long-term investor.
Invest wisely, my friends.