On-Going Stories -- If I Had To Name One Investing Debacle -- Worse Investment Story Of 2023? July 11, 2023

Locator: 45073DIS.

Updates

July 12, 2023:

• Bob Iger to stay until 2026, two years longer than expected. 

Original Post

This is what makes the Disney story so compelling:

• literally millions of American investors have accumulated lots of DIS over the years
• if not directly, through passively managed IRAs, Roths, pension plans, BRK
• literally every analyst over the years saw DIS as a no-brainer
• millions of Disney employees over the years accumulated DIS
  
• following Covid-19 lockdown, theme parks should have been huge beneficiaries
• what went wrong: 
• perceived high ticket cost?
• failure to understand OTT or failure to act? Failure to capitalize on brand name, on library?
  

Others have noted the same thing:

I haven't watched CNBC in a month of Sundays, but if Jim Cramer isn't talking about this, it tells me all I need to know about Jim Cramer. Today. I'll flip-flop tomorrow. LOL.

See this link.

Disney:

• Bob Igor returned November 20, 2022
• stock price 92 on November 18, 2022
• rose to $113 on Feb 2, 2023
• since then, steady fall
• May 8, $103
• WSJ article how bad theme parks are doing
• yesterday, $88 falling 0.6% when DOW gained 206 points or 0.6%.

Talk about a wispy-washy article that sounds like it was written by a robot to ChatGPT:

https://finance.yahoo.com/news/4-measures-indicate-walt-disney-110055339.html

Link here. 

Is Bob confused? Link here.

From MSNBC:

The Walt Disney Company, plagued by trouble in its streaming business, TV networks, and studios, now faces problems at its mighty theme parks. According to The Wall Street Journal, "Data from a travel company that tracks line-waiting time at Walt Disney World in Orlando, Fla., shows that the Independence Day weekend was one of the slowest in nearly a decade." The deep problems CEO Bob Iger faces grow more troubling by the month.

Disney’s stock has been down 50% in the last two years while the market is flat. Iger replaced Bob Chapek in November 2022, but the two-year-old slide covers the period during which Iger restructured Disney.

In the most recently reported quarter, Disney segment operating revenue rose 8% to $21.8 billion. This rise was because of theme parks, the revenue of which rose 17% to $7.8 billion. Operating segment income for Disney was $3.4 billion, down 11%. Theme park operating income rose 25% to $2.2 billion.

Disney described the health of its theme parks by announcing, “The increase in operating results at Disneyland Paris was due to volume growth, which was attributable to higher attendance, and increased guest spending, partially offset by higher costs.” If theme park activity at locations outside Orlando is weak, Disney cannot make up for the problem financially.

So much more at the link.