After suffering a setback for a year and a half after Bob Iger returned to the CEO position, Walt Disney Co. (NYSE: DIS) stock has begun to recover. Shares are up 25% this year, compared to less than a 10% gain for the S&P 500.
It has been about a month since Disney won a bruising proxy war with raider Nelson Peltz. Peltz did benefit. He made about $300 million on his investment.
The tide has turned because people have started to view Iger’s tenure differently. What was a disaster in streaming has started to lose less money. Iger says the company can close the gap between its costs and income. Some of this will come with price increases. There is a lot of leverage in what customers will pay. The streaming channel Disney+ has over 150 million subscribers.
Disney’s theme parks, one of its oldest businesses, saw revenue increase of 7% last year. Operating income rose 8% for the three months ending December 30. Most major parks in the company’s portfolio have raised prices this year.
The movie division had a tough year in 2023. This year, it has several titles that should do well. A new version of “Snow White,” one of Disney’s franchises, is on the way. “Frozen 3” and “Toy Story 5” will be released this year. Each is part of one of Disney’s most popular franchises.
Peltz is gone, Iger has breathing room, and 2024 looks promising. Now, all Iger has to do is deliver.
If you invested $15,000 in Disney 10 years ago, this is how much you would have today.
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