4. The Walt Disney Company (NYSE: DIS)
Number of Hedge Fund Holders: 134
The Walt Disney Company (NYSE: DIS) is a Los Angeles-based mass media and entertainment company. It was founded in 1923 and is placed fourth on our list of 10 best spring stocks to buy now. The company’s shares have offered investors returns exceeding 41% over the past twelve months. With the rollout of the COVID-19 vaccine, business activities have resumed across the world and the firm will be a top gainer in the post-pandemic economy as people starved for entertainment frequent several Disney theme parks.
In quarterly earnings for the second fiscal quarter, posted earlier in May, The Walt Disney Company (NYSE: DIS) reported earnings per share of $0.79, beating market predictions by $0.53. The revenue for the second fiscal quarter was more than $15 billion, missing market estimates by over $300 million.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in The Walt Disney Company (NYSE: DIS) with 10.3 million shares worth more than $1.9 billion.
Harding Loevner, in their Q4 2020 investor letter, mentioned The Walt Disney Company (NYSE: DIS). Here is what the fund said:
“One of the original constituents of the Nifty Fifty holds a place in our portfolio today. When we bought Disney three years ago, we wrote that “we view Disney theme parks in the US, Europe, and China as resistant to online substitution.” We did not reckon on a pandemic, which closed all of them, and sent all of usto our couches. Disney, however, was ready for us, brilliantly illustrating the importance of management foresight and change management. Or, as Louis Pasteur said, “chance favors the prepared mind.”
A century after its founding in 1923, Disney is in the middle of a bold shift from its legacy media networks & entertainment model—with cable TV, theme parks, and theater films dominating its earnings—to a direct-to-consumer streaming media model. The keys to Disney’s transition: matchless storytelling, coupled with financial strength. The company reliably creates content that people all over the world are eager to consume. It also hastened spending on original content to attract subscribers to its new streaming platform. These factors have allowed Disney to weather the pandemic having expanded its direct engagement with customers. Such connections yield a rich harvest of insights used to customize offerings on a mass scale, reinforcing that engagement in a virtuous circle and thereby raising the lifetime value of each customer. Subscribers to Disney+ reached 86.8 million one year after launch, compared to the 60 – 90 million management projected to reach in 2024. To be sure, Netflix, Apple, and Amazon remain formidable competitors in new-era streaming entertainment (mind what we said about everyone standing up at once), but there’s fight left in this old dog.”
