TheMotorcycleBoy wrote:Disney's long-awaited foray into the streaming wars could help catapult its stock price as much as 20% higher over the next 12 months, according to Bank of America Merrill Lynch.
A team of analysts led by Jessica Reif Ehrlich increased their five-year subscriber target for Disney Plus to 90 million, up from a prior forecast of 60 million.
"Based on comparable analysis of NFLX sub growth over the last five years, we believe the accumulation and retention of 90mn subs appears achievable for DIS+, if not conservative," the firm wrote in a note to clients on Tuesday.
Yesterday Disney announced that Disney+ had 10 million subscribers on the first day of operation. Some analysts had pencilled in no more than 10 million subscribers by the end of the first year. No wonder Disney's shares rose by 7%. I suspect that the good reviews for "The Mandalorian" (i.e. the damage caused to Star Wars isn't terminal) might have had a little bit to do with the rise
Jim Cramer of CNBC, who has long been a big fan of Disney (both as an investor and consumer), said:
“Today we got the real number. It’s more than 10 million. That’s double my prediction, and I was the biggest bull out there,” Cramer said. Cramer talks about Disney and Disney+ in the two videos linked below:
https://www.cnbc.com/2019/11/13/jim-cra ... l-run.htmlDisney, like McDonalds, is a great example of the sort of company that isn't available to investors who restrict themselves to companies quoted in London. A decade ago, when Berkshire Hathaway bought the Burlington Northern Santa Fe railroad, the British investment media suddenly became filled with articles about how to invest in British railways (mostly First Group), with almost nothing about buying shares in other American railroads. Almost everyone missed the key difference; the nature of the market for American railroads is very different to that in Britain. Me, I topped up Union Pacific and Canadian Pacific.
American railroads' business is long-distance freight where the company owns the railroad, in Britain we have short-distance passenger rail where the companies rent access to the railway.
P.S. re. McDonalds. American companies have to value property at cost plus improvements minus accumulated depreciation (because of the GAAP accounting standard). Market value has nothing to do with it, unless you've just bought it in which case accounting value = what you paid. If there were real concerns about the company because of its accounting NAV, McDonalds' bonds would be trading at junk bond levels. Instead the agencies give McDonalds a "BBB" credit rating (an "investment grade" rating).
Cramer talks a bit about McDonalds at about 8 minutes into the second video in the link above.