5 Best Falling Stocks To Buy Now

2. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 113

Year-to-Date Share Price Decline (as of August 9): 31.42%

Walt Disney Company (NYSE:DIS) is a global media and entertainment conglomerate with interests in theme parks, studio films, and digital streaming through its Disney+ platform. The Q1 database of Insider Monkey shows 113 hedge funds with long bets on the company shares, with a collective price tag of $5.16 billion.

On July 26, Truist analyst Matthew Thornton lowered the firm’s price target on The Walt Disney Company (NYSE:DIS) to $125 from $135 and maintained a ‘Buy’ rating on the company shares. The analyst sees Disney’s 2024 target of 230-260 million subscribers as hard to achieve given the loss of IPL cricket streaming rights, but he thinks a figure around 206 million is achievable. The analyst is bullish on the opportunity to bolster gross adds, retention, and average revenue per user. Disney’s theme parks business could also recover to higher revenue and profitability, observed Thornton in his thesis.

Despite shares being down 31.42% in the year to date, Walt Disney Company (NYSE:DIS) is a an attractive option for investors with a view for long-term gains. Popular hedge funds held major stakes in the company during the first quarter, and its largest shareholder at the end of March was Matrix Capital Management, which held 6.33 million shares worth roughly $868 million.

Oakmark Fund, an investment firm, shared a bullish outlook on The Walt Disney Company (NYSE:DIS) as part of its Q2 2022 investor letter. Here’s what they said:

“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.”