Say No To Trading
Public Markets Investor, Opportunistic Buying & Cost-Basis Management
Disney's old IP thesis was wrong because its business has been too capital-intensive as run this century. Even buying at the exact lows over roughly 12 years would have meant losing badly to inflation. Re-entry would only make sense if Disney changed its operating model, perhaps even through a split. x.comÂ
Disney is a dog with fleas. Absurdly high theme-park prices face demand elasticity as a weakening consumer in a K-shaped economy pulls back. Its movie lineup is dated, with live-action Moana joining Snow White as box-office bombs; its balance sheet carries heavy debt from poorly conceived acquisitions that could curb park spending; and AI threatens several businesses. There is a price for everything: below $90, reward versus risk turns favorable. x.com x.comÂ
Disney is a value trap over the medium to long term, with no real reason to structurally re-rate. It can work as a tactical trade, to own when parks data is good and consumers keep absorbing price increases. That answers @ErnestWongBWM's case that parks are about 60% of profits and the stock trades below 15 times 2026 consensus EPS. x.comÂ
Disney's problems stem from a lack of aggressive moves in content, and its cable business needs to go. Spinning out ESPN would address that, rather than blaming the $71B Fox acquisition as @DividendsCoffee suggests. x.comÂ
Disney looks like a dead stock walking as it raises streaming prices again on a service with little to no new content and many more commercials. Subscribers seem unlikely to keep paying, which is probably why management stopped reporting subscriber numbers. x.comÂ
Disney's stock will not reverse until it drops the Pride flags, since every position carrying them has been crucified. x.comÂ
Disney's improved fundamentals against a compressed P/E make the shares a coiled spring. Revenue is climbing 5-10% yearly, net income rose from $2 billion to $12 billion, and margins expanded while the stock has not reached a new all-time high in six years. That is a six-year discount with sixfold better fundamentals. x.comÂ
Disney is a far better buy than MGM Resorts: Disney is a very inexpensive stock with irreplaceable assets, and Toy Story 5 is set to crush it for the company. x.comÂ
Disney is very likely to break below its 200-period moving average, opening a path to $40, with the fourth quarter of 2021 marking the peak. Streaming cancellations are skyrocketing, and people who can't afford groceries won't go to Disney parks either. x.comÂ
Disney's stock has gone nowhere since 2015 even as the business grew substantially. Revenue doubled, its cruise fleet doubled from four to eight ships, Disney+ and Hulu became a streaming powerhouse, parks hit record revenue and attendance, and it broke the record for highest-grossing animated film three times. x.comÂ
Netflix's valuation is still far from cheap for its growth profile, at over 20 times cash flow and 6 times sales, so the stock's continued fall after solid quarterly results is justified. After the failed Warner acquisition, Netflix still lacks timeless franchises and brands, and sequels to its own productions regularly disappoint and fall short of Disney and Warner quality. The stock is not worth touching even around $60. x.comÂ
