3. The Walt Disney Company (NYSE: DIS)
Number of Hedge Fund Holders: 112
Media and entertainment giant The Walt Disney Company (NYSE: DIS) ranks 3rd on the list of 15 best blue-chip stocks to invest in. The California-based media company runs domestic cable channels including ESPN, National Geographic, FX, and Disney. The Walt Disney Company (NYSE: DIS) also owns and operates all of the Disneyland theme parks and resorts, as well as the Disney Cruise Line.
On August 27, Deutsche Bank analyst Bryan Kraft maintained a Buy rating and a $200 price target on The Walt Disney Company (NYSE: DIS), citing a solid growth outlook with direct-to-consumer sales expected to grow at a rate of 25% through fiscal 2024. Shares of The Walt Disney Company (NYSE: DIS) jumped 1.4% on August 27 after ESPN announced plans to license its brand to major sports-betting operators for at least $3 billion, according to a report from The Wall Street Journal.
The company has a market cap of $327 billion. In the third quarter of fiscal 2021, The Walt Disney Company (NYSE: DIS) reported an EPS of $0.80, beating estimates by $0.25. The company’s revenue in the quarter grew 45% year over year to $17.02 billion and beat revenue estimates by $261.22 million. At the end of the third quarter, The Walt Disney Company (NYSE: DIS) had nearly 174 million subscriptions across Disney+, ESPN+, and Hulu.
At the end of the second quarter of 2021, 112 hedge funds in the database of Insider Monkey held stakes worth $10.8 billion in The Walt Disney Company (NYSE: DIS).
In its Q2 2021 investor letter, RiverPark Funds mentioned The Walt Disney Company (NYSE: DIS) and discussed its stance on the firm. Here is what the fund said:
“DIS shares declined for the quarter, taking a pause after a big fourth quarter and first quarter stock price advance, as Disney+ subscriber numbers were disappointing to investors. Disney+, the company’s DTC streaming business, had blown past previous subscriber projections, having gone from zero to 104 million in 17 months, but investors were now expecting 109 million subscribers. Management still expects significant continued growth to 230-260 million subscribers in 2024.
DIS is blessed with a deep library of unique content that includes both live sports (providing large, non-time shifted audiences) and incomparable brands including Disney, Marvel, Pixar, and Lucasfilm, as well as the ABC network. The company also has a wealth of upcoming new content, expecting over 100 original titles per year, including two new Star Wars spin-off series, 10 Star Wars films, 10 Marvel films, 15 Disney and Pixar films, and 15 Disney and Pixar series.
Now that the disruption in its theme park, cruise, and theatrical businesses appears to be coming to an end, we believe that Disney is among the best-positioned media companies in the new landscape to combine multi-channel and DTC distribution. We also note that DIS has an extremely strong balance sheet and a growing pool of free cash flow to be used both to return to shareholders and to invest in future opportunities.”
