5 Stocks Hedge Funds Are Talking About

4. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 92

Burbank, California-based The Walt Disney Company (NYSE:DIS) is among the top 10 stocks hedge funds are talking about. The Walt Disney Company (NYSE:DIS)’s revenue increased by 5% to $21.24 billion, slightly below the consensus of $21.4 billion, primarily influenced by the robust performance of the company’s Parks unit. With an annualized cost savings target of $7.5 billion, The Walt Disney Company (NYSE:DIS) achieved an adjusted earnings per share of $0.82, a significant improvement from the year-ago figure of $0.30 and surpassing the anticipated $0.71 per share.

The Walt Disney Company (NYSE:DIS)’s CEO, Robert Iger is optimistic that the company will achieve profitability in Q4 of fiscal 2024 as he made the following remarks in their Q4 2023 earnings call:

“The fourth quarter adjusted earnings per share nearly tripled over the prior year. And all three of our businesses, Entertainment, Experiences, and Sports saw significant increases in fourth quarter operating income compared to Q4 of fiscal 2022. The thorough restructuring of our company has enabled tremendous efficiencies and we’re on track to achieve roughly $7.5 billion in cost reductions, which is approximately $2 billion more than we targeted earlier this year. Our new structure also enabled us to greatly enhance our effectiveness, particularly in streaming, where we’ve created a more unified, cohesive and highly coordinated approach to marketing, pricing and programing. This has helped us to improve operating results of our combined streaming businesses by approximately $1.4 billion from fiscal 2022 to fiscal 2023. And we remain confident that we will achieve profitability in Q4 of fiscal 2024.”

Madison Sustainable Equity Fund made the following comment about The Walt Disney Company (NYSE:DIS) in its Q3 2023 investor letter:

“During the quarter, we sold our positions in Bristol-Myers Squibb and The Walt Disney Company (NYSE:DIS).  The Walt Disney Company is facing a difficult and uncertain transition in its core media business assets including the ESPN business and other linear media assets. These media assets are cash generative but face secular decline as consumers are cutting their expensive cable subscriptions and moving to alternative streaming options. This has resulted in a decline in operating profits for the media division. The media business has long-term fixed costs related to its sports broadcasting agreement with multiple sports leagues which will further pressure profits during this transition.”