In 1918, a young Walt Disney was diagnosed with the Spanish flu while preparing for a Red Cross deployment in Chicago. Of course, he eventually recovered and founded The Walt Disney Company with his brother.
Back then, the world was dealing with a pandemic just as we are experiencing now. This current pandemic has cost Disney as much as $1.4 billion during the last quarter. This is due to a temporary closure of theme parks, retail stores, suspended cruise ship sailings, and disruptions to movie releases.
Of course, Disney is still a fantastic company to invest in. Take a look at the guide below to find out why it’s a good time to invest in Disney Stock.
There Are Many Re-openings
Shanghai Disneyland reopened in May, and tickets sold fast. In the U.S., the company announced that Walt Disney World would reopen on July 11 and Disneyland on July 17.
Another good sign is the return of movie releases in theaters, as Disney typically dominates the box office. Disney’s Mulan will be showing in U.S. theaters on July 24, followed by Marvel’s Black Widow on November 6.
The National Basketball Association (NBA) announced that it plans to resume its season on July 30. Generally speaking, the announcements and reopening give Disney investors a twofold advantage.
Investors will quickly begin to generate revenue, cash flow, and profits again soon.
Disney Produces the Best and Timeless Movie Franchises
It is not just the amount of material from Disney that gives the company a competitive edge. Disney’s Marvel and Lucasfilm movies are among the most popular franchises ever, including the Avengers and Star Wars movies. Since 2006, the box office average has been $690 million for each of the 22 films produced by Disney and Pixar.
The 18 films produced by Disney’s Marvel Studios have earned a total of $960 million in box office sales since 2009.
Disney’s most valuable television network, ESPN, has been ranked the number one cable television network in the US for 13 years in a row. The firm also owns a variety of other prominent networks including ABC, Disney Channel, Freeform, Lifetime, and the National Geographic.
The Market Continues to Expand
Another significant phenomenon that will benefit Disney investors, is the growing global market.
The company is already seeing this in India, where a compound annual growth rate of 10 percent increases household earnings. Disney estimates that there will soon be 1 billion video screens in the world, creating a prime market for entertainment offerings for the company.
Streaming Services Continue to Grow Tremendously
One of Disney’s top growth opportunities is through streaming. Fox’s acquisition gave Disney a majority stake in Hulu, the fastest-growing US TV streaming service.
This year also marks the launch of the Disney+ streaming service.
At the end of the fiscal year, 2024, Disney expects to have 90 million subscribers. The ESPN+ streaming service already has over 2 million subscribers and continues to notice strong growth.
One of Disney’s key strengths is its ability to market its intellectual property across markets.
For example, as with Aladdin and Dumbo, Disney turns their animated films into live-action films. It is also designing attractions based on its famous movies at its theme parks, including the Star Wars and Toy Story franchises.
Every hit movie could potentially be monetized in many other forms in the future.
For such a big corporation, you can expect great returns by investing in Disney Stock. Despite the setbacks of Covid 19, the company is expected to quickly bounce back.
The free cash flow of more than $7 billion from Disney, provides the company with a stable monetary base to keep its momentum going by investing in growth and rewarding shareholders.