Before buying or selling Walt Disney shares, it is essential to understand the key factors influencing this decision. As an investor, it is crucial to consider a number of factors when assessing the growth and return potential of Disney shares. This page aims to provide a detailed overview of the factors to consider before making an investment decision in one of the entertainment industry's largest companies. From financial performance to market trends, competition and technological innovation, we explore the major aspects that will help you make informed decisions about Walt Disney stock.
The company's financial results, such as revenues, profits and margins, play a key role in assessing the value of Disney shares. Sustained growth and results that exceed investors' expectations can boost demand for the stock.
Walt Disney is a diversified conglomerate with activities in films, theme parks, broadcast media, streaming and consumer products. The individual performance of these segments has a significant impact on the DIS share. For example, the success of films at the box office, subscriptions to Disney+ or attendance at theme parks can have a positive impact on the share price.
Competition in the entertainment industry can affect Disney's share price. The rise of new players in streaming or theme parks may put pressure on Disney's market share and profitability, which may influence the share price.
Disney must remain at the forefront of technological innovation to meet changing consumer demands. The success of new technologies, platforms or entertainment experiences can have a significant impact on the share price.
Geopolitical developments, such as trade wars or changes in tax policy, may influence the company's performance, particularly where its international activities are concerned.
Announcements concerning mergers, acquisitions, partnerships or restructuring may have an impact on investors' perception of the company's future direction and therefore on the share price.
The Walt Disney Group is an American media and leisure group that exercises different types of activities that can be divided into different categories depending on the turnover generated in this way:
The Walt Disney Group currently exercises its activities throughout the world and employs over 200,000 people.
Photo credits: ©nikkimeel/123RF.COM
Let's take a look at some of the Walt Disney Group's major competitors to help you understand how news in this industry is likely to affect the stock price.
This company is currently one of the largest production and distribution companies in the world for both film and television. It is a subsidiary of Warner Media which is based in New York. The company also owns several subsidiaries including Warner Bros television, Warner Bros Animation and others.
Another competitor to Disney is Universal, an American music label owned by the French company Vivendi since 2000. It is now completely independent of Universal Studios which is owned by NBCUniversal. Universal Music Group is also one of the three largest companies in the music industry, with over a third of the global sales market share. It is currently headquartered in Hilversum, the Netherlands, and has its operational headquarters in Santa Monica, USA.
This US company specialises in the production of animated films and television series. In the past it was also a division of DreamWorks SKG.
Another competitor of Disney and more precisely of its video-on-demand service Disney+ is the Netflix group which is an American multinational company created in 1997 and which operates in the creative industries sector. It specialises in the distribution and exploitation of film and television works through a dedicated platform. Formerly specialising in commercial exploitation through the provision of online DVD rental and purchase services with home delivery, it later offered rentals via a monthly subscription. The group launched its subscription video-on-demand service in 2007 and has also since moved into the distribution of a wide range of films and TV series.
Finally, Disney's last competitor also in video-on-demand is the Amazon Group, which is basically an American online retail company based in Seattle. After its initial activity of selling books by mail order, the group then diversified into the sale of all kinds of articles and more recently into a streaming video service.
To conclude this article here are the major current partners of the Walt Disney Company worldwide:
In 2014 the French group TF1 entered into partnership with Walt Disney France for the rights to upcoming Marvel studio productions and The Star Wars saga films.
In 2015 the Nintendo video games company signed a significant partnership agreement with the Walt Disney Group aimed at developing video games and films around the emblematic characters of the two companies including Mario and Mickey.
In 2017 the Netflix Group obtained a strategic alliance with Walt Disney by offering its subscribers access to the group’s productions including the great Disney films as well as productions by Pixel, Marvel and Lucasfilm.
One of the greatest strengths of the Walt Disney Group is of course its wide covering of cable network channels. In fact, the company is at the head of a cable network that covers a wide zone and notably operates the following channels: ABC, Disney Channel Worldwide and ESPN as well as a sport and leisure company that is broadcast in no less than 60 different countries worldwide. In total, there are more than a hundred different television channels broadcast by Walt Disney in 34 different languages and 163 countries worldwide. This represents around 123 million subscribers on an international level. Due to this huge network and its influence the Walt Disney Group possesses a real advantage against its competition. The margin generated by this large number of subscribers is also comfortable and enables the group to generate high revenue each year. Of course, this revenue from subscribers is in addition to that generated by the sale of advertising space.
The Walt Disney Group can also benefit from a significant control of strong brands that enables it to take advantageous positions on the market. It is in fact at the head of some of the best media brands on the market such as Marvel, Pixar, ESPN, Touchstone and Lucasfilm. All these brands have the particularity of being renowned for their high quality and popularity.
Finally, and from a purely financial point of view, we should underline the advantages offered by the profits and margins achieved by the Walt Disney Company which have been experiencing full growth for a number of years. This is highly reassuring to investors and shareholders of this asset.
Here we would highlight the strong dependence of Walt Disney from a geographical point of view on one particular area and region. Despite the efforts and attempts made by the group to develop its activities throughout the world the market where it continues to achieve the majority of its profit remains that of North America. This geographical zone mainly concerns the United States and, to a lesser extent Canada, which alone generates nearly 77% of the revenue of the company. Of course, this strong geographical dependence incurs a certain exposure to the economical risks of this zone and diverse changes in regulations that could negatively influence the future profitability of the Walt Disney Company.
Finally, another significant weak point we should not forget of the Walt Disney Group is the unfunded pension plans. Although the major figures are accounted for as annual net profits it is also important to take into account the passive net value with which they are associated and which currently accounts for nearly three billion dollars in unpaid pensions. The repayment of this debt could severely lower the profitability level of this group.
If you are interested in the history of the Walt Disney group, you should know some key dates. First of all, it was in 1923 that the Disney Brothers Studios company was created. A few years later, in 1929, the company was renamed and was now called Walt Disney Productions. It was finally in February 1986 that the group took on the name we know today, namely The Walt Disney Company.
The Walt Dinsey group has made several major acquisitions in its history, notably in 1993 Miramax Films for $ 80 million, in 1996 Capital Cities for $ 19 billion in 2001, Fox Family WorldWide and Saban Entertainment for $ 5.3 billion, in 2006 Pixar for 7.4 billion dollars, in 2009 Marvel for 4.3 billion dollars, in 2012 LucasFilm for 4.05 billion dollars and in 2017 21th Fox, whose transaction will not be finalized, however.
For many years, the turnover published by the Walt Disney group has been increasing, which in particular allows its stock market action to evolve positively on the market. Thus, the latest balance sheet for the 2019 financial year is no exception to the rule with a turnover of 69.6 billion US dollars. The group's net income also increased with $ 14.8 billion in profit.
You can buy or sell Disney shares on the stock markets where they are listed. Disney is generally listed on major exchanges such as the New York Stock Exchange (NYSE). To trade, you need a brokerage account, which you can open with online or traditional brokerage firms. Once your account is open, you can search for Disney shares using the 'DIS' symbol and place your buy or sell orders. Finally, you can also buy or sell Disney shares using CFDs or contracts for difference.
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