Excellent quarterly reports for The Walt Disney Company.
The strong recovery in tourism in its theme parks has driven the company’s profits with a resounding + 600%.
Streaming revenues increased by 11% but profits fell by 32%. This figure certainly makes us reflect and could be a harbinger of incoming increases for the Disney plus service which for now, has wanted to make room in a world with important competitors (Netflix and Amazon first videos above all), providing its service to aggressive pricing.
Remember that the Media & Entertainment Distribution sector also includes two other proprietary platforms, namely Hulu and ESPN +.
Overall operating profit increased by 50% and is the reason for the upward gap of 11 August.
On a graphical level, after hitting $ 90 per share, the price reacted, driven by the important pull-back of the S&P 500 which is still ongoing; already last week, speaking of Amazon, I said that I would expect a retracement, which will surely happen.
At that moment I will add size on Disney, as I am now in a slight drawdown having an average price of around $ 150.
After all, in the last two years, the price has traded more in the $ 170 area. It is reasonable to expect a price in that area in the next 6 months, as long as the economic situation stabilizes and inflation falls back to around 3 percentage points, which is still a long way off at the moment.
Disney certainly shows solidity, thanks to its core business, which has strongly recovered. There is definitely room for improvement in the streaming field, we hope they find the right way.
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