In this article, we will look at 2 stocks that Jim Cramer is recommending for a “mild” recession. If you want to explore similar stocks, you can also read 4 Jim Cramer Stocks for ‘Mild’ Recession.
2. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 113
Jim Cramer thinks The Walt Disney Company (NYSE:DIS) is a good fit for a mild recession and noted that the company’s theme park business will remain resilient in an economic downturn. Wall Street is also bullish on The Walt Disney Company (NYSE:DIS). Over the past 3 months, the stock has received 17 Buy ratings and 8 Hold ratings and has a consensus Buy rating from Wall Street analysts. The stock’s average price target of $136 implies a 26% upside from its closing price on August 4 which sits at $108.12.
This July, Goldman Sachs analyst Brett Feldman revised his price target on The Walt Disney Company (NYSE:DIS) to $130 from $148 and reiterated a Buy rating on the shares. On July 31, Truist analyst Matthew Thornton adjusted his price target on The Walt Disney Company (NYSE:DIS) to $125 from $135 and maintained a Buy rating on the shares. The analyst sees the company’s theme parks business recovering to higher revenue and profitability from increased direct-to-consumer content spending.
As of June 30, Yacktman Asset Management owns more than 1.66 million shares of The Walt Disney Company (NYSE:DIS) and is the largest shareholder in the company. The fund’s stakes are valued at $157.39 million and the investment covers 1.63% of its 13F portfolio.
Hedge funds are initiating positions in The Walt Disney Company (NYSE:DIS). At the end of the first quarter of 2022, 113 hedge funds disclosed ownership of stakes in The Walt Disney Company (NYSE:DIS). The total value of these stakes came in at $5.16 billion. This is compared to 111 positions in the preceding quarter with stakes worth $6.94 billion.
Oakmark Funds, an investment management firm, mentioned The Walt Disney Company (NYSE:DIS) in its “Oakmark Fund” second-quarter 2022 investor letter. Here is what the firm had to say:
“Disney (NYSE:DIS) is one of the most beloved consumer companies in the world. Its media business has a rich library of intellectual property, which provides a powerful engine for creating new content across the Disney, Pixar, Marvel, and Star Wars brands. This content also contributes to the success of Disney’s theme parks, which generated nearly half the company’s earnings and grew more than 10% annually in the decade prior to the pandemic. Shares have fallen nearly 50% over the past year as investors worried about the company’s ability to transition its media business to a direct-to-consumer streaming world. This transition has required management to make investments in its Disney+ streaming service that are depressing profitability today. However, we believe these investments will ultimately produce attractive returns as Disney+ continues to grow subscribers and increase pricing over time. As a result, we were able to purchase shares at a substantial discount to our estimate of intrinsic value.”
