Robinhood has just announced its “Robinhood Investor Index.” The 100 stocks included are the most popular among its customers. Robinhood claims to have 22 million funded accounts. 

The initial reaction among many people who track the stocks they believe Robinhood investors own is that the list would be topped by GameStop and AMC. Any stock, which regularly rides up over 100% in a few hours, or down 50% over the same time frame, might be included. Surprisingly, the only such stock in the top five of the index is AMC, which has been in the news because many people do not believe it can survive the drop of people who go to the movies.
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The other stocks in the top five are Ford, Apple, Tesla, and Amazon. Floating on the chart of the 10 most favored stocks is Disney. Aside from Ford, it is the only company that has a foot in the pre-tech economy.

There are two reasons Disney may be on the list. Like most of the others, its brand recognition is nearly universal. Second, the management of the company and its evolution toward the digital future have been part of the worst kind of public corporation theater. Management’s missteps will end up in the case studies of major business schools. The executive ranks of the company have been through a revolving door. At the top of Disney, new CEO Bob Chapek recently got a new contract from the Disney board, just as other investors wanted him ousted.

The major question about Disney is whether it can make the transition from old-style TV networks, physical theaters, and outdoor theme parks to a company that serves hundreds of millions of customers digitally. The start of this was promising, but begun by retired and widely regarded CEO Robert Iger. Disney+, the company’s horse in the streaming media race, had 87 million subscribers in a year. That meant it had quickly put itself into a position to challenge market leaders Netflix and Amazon.

Disney+ drew heavily on content it had had for years or content Iger bought over the course of his tenure. This included the Star Wars franchise, Marvel and Pixar films, National Geographic, ESPN, and films about Disney characters created decades ago.

Disney made good on its forecast that Disney+ would be a huge success. At the end of the last reported quarter, it had 221 million subscribers which apparently topped both Netflix and Amazon. The part of the announcement that created anxiety was that the figure had only increased 14.4 million from the previous period. Netflix had recently announced its growth had stalled. The entire industry may have plateaued. Disney jacked up rates to offset slowing growth which may prove to dampen demand considerably.

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Why is Disney’s stock so popular? It may be the ubiquity of the brand. Or, it may be that the company is a never ending trainwreck.

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