Guest Schwab711 Posted September 30, 2015 Share Posted September 30, 2015 I couldn't find the DIS thread so please link if there is one and I'll move this comment there. I would love to see DIS spin-off ESPN since the rest of their businesses are fantastic and I would hate to see them suffer because of ESPN's problems. It doesn't seem like ESPN is necessary for their current business strategy other than ABC/ESPN sports cross-over. They could keep a controlling stake (31% or 51%, depending on their relationship with Hearst) and stipulate an ABC/ESPN relationship agreement for the next 5-10 years. It would help DIS lower their reliance on cable bundling. The main argument against this is ESPN's carriage negotiating leverage supports higher carriage fees for the Disney Channel and other 2nd-tier channels (ESPN2, ESPN3, ESPNU, ect). I don't think this would be too big of a problem if they kept a controlling stake in ESPN and secured the relationship agreement. I just want to buy DIS but I don't want ESPN to be so important to my investment. Stock Price: $101.83 *Ratios are all TTM MC: $171.8B EV: $185.3B P/E: 21.2 Fwd P/E: 18.1 EV/EBITDA: 12.5 ROA: 9.11% ROE: 17.63% Link to comment Share on other sites More sharing options...
DCG Posted September 30, 2015 Share Posted September 30, 2015 At one point (just a few years ago) part of the reason I like Disney was because of ESPN. Now, they've unfortunately basically turned ESPN into TMZ for sports (especially with their website/app). Link to comment Share on other sites More sharing options...
Guest Schwab711 Posted September 30, 2015 Share Posted September 30, 2015 At one point (just a few years ago) part of the reason I like Disney was because of ESPN. Now, they've unfortunately basically turned ESPN into TMZ for sports (especially with their website/app). Agreed! I think my biggest concern with ESPN is what you mention. They have chased away hardcore sports fans who are now going to specialized sites instead (MLBTR, FanGraphs, ProFootballFocus, ProFootballTalk, ect). I think ESPN is going to regret this strategy once cord-cutting/de-bundling begins since the average fan they currently pander to will not pay the >$20/month for ESPN alone (the a la carte equivalent/SlingTV price). I keep waiting for NBC or Fox sports to go on a niche sports site buying spree and try to become the sports leader for hardcore fans. That is going to be the long-term future of sports content, in my opinion. Does anyone think sports is in a bubble? Team prices, tv deals, ticket prices, and just about everything else related to them. It seems like more average folks are big sports fans now than even 10-15 years ago. It almost seems like a fad for the average person. Link to comment Share on other sites More sharing options...
ccap Posted October 1, 2015 Share Posted October 1, 2015 I think sports are making some decisions that they will regret later on. Many local baseball games are no longer on TV. They are on small cable channels. This probably makes the team money in the short term, but if kids aren't watching the sports on TV, they will have no interest in forking over money when they are older. College sports are similar. Team specific cable channels have sprouted up that keep the games from kids (e.g. Longhorn network). If kids aren't brainwashed early, they won't fork over cash later. Link to comment Share on other sites More sharing options...
ccplz Posted October 1, 2015 Share Posted October 1, 2015 Disney seems a lot more expensive than Fox/TWX with a comparable set of assets.. Link to comment Share on other sites More sharing options...
GregS Posted February 10, 2016 Share Posted February 10, 2016 Anyone looking at Disney at these levels? Questions over ESPN are obviously weighing on the stock, but the IP is best in class and the studio pipeline is enormous. More Star Wars, more Marvel, sequels from Cars, Nemo, Frozen, Toy Story, Incredibles, Pirates. Studio IP driving theme park/resort visits and merchandising. Increasingly global reach. Here's Iger stating the bull case on the call (in response to a question about separation): I'm not going to talk about separating those assets. We fully expected that our media assets are going to continue to contribute to our growth. We also are designed, as a Company, to leverage intellectual property across a lot of our businesses or to leverage the collection of brands nicely in the marketplace. And that also is reflected in the way we operate the businesses from an expense perspective, with consolidation in many different areas. So if you look at the profile of the Company, interestingly enough, since 2009, look at the growth profile, the Company has grown on a compounded basis by 14%. The media networks have driven about 8% compounded a year and the rest of the Company grew 23%. So 8% a year is pretty strong. 23% is extraordinary. 14%, pretty damn strong, too. I think that what that says is really, is that over the period of time, we've actually diversified our ability to generate growth and profitability and that was very purposeful. These investments that we made it Pixar and Marvel and in Lucasfilm and the investments that we've made in our parks were designed for us to diversify our bottom line or our growth. And that was not just across businesses, but really across the world, because a lot of these businesses are global in nature, unlike some of our media assets. Link to comment Share on other sites More sharing options...
TorontoRaptorsFan Posted February 10, 2016 Share Posted February 10, 2016 It's a permanent holding for me. Wonderful set of movies coming down the pipeline, StarWars expansion to the theme parks. New Disney park opened in China. Link to comment Share on other sites More sharing options...
LongTermView Posted February 10, 2016 Share Posted February 10, 2016 Long DIS. They are a unique company. Link to comment Share on other sites More sharing options...
valueinvesting101 Posted February 10, 2016 Share Posted February 10, 2016 Disney's success is based on two set of films. Superheroes and Animation. Boundary between then is blurring already. This has been successful strategy for last few years but it seems that we are reaching saturation level with it. There are other franchisees as well. Harry Potter series is adding 3 more movies. LOTR adding 3 Hobbit movies etc. Disney does have good assets but they are bound by competition and it would be difficult from to continue same success over next 5 years due to fatigue with similar kind of movies. This is qualitative assessment. I believe ultimately Disney's success will depend on capitalizing growing middle class and younger population in Asia. It could be tricky market to do well over medium to longer term. For quantitative perspective, ESPN forms bulk for profit percentage and that model is definitely under pressure. Media networks was 69% of operating income in 2011 and 53% in 2015. Partly due to success of studio entertainment which rose from 7% of OP to 13.5% but 3 times in actual numbers from $618 million to $1.9 billion. This is definitely cyclical part and drives park and consumer product revenue to large extent. So you have 50% of profit at risk from ESPN and remaining looks right now but can falter due to change in market taste or bad execution or something else. From execution perspective, studio side seem to be doing really good during last 4 years. Can it be guaranteed for next 4-5 years? I am skeptical. But it is hard to predict business. I think it a good business and better quality than Fox or TWC but it valuation seems expensive right now. Link to comment Share on other sites More sharing options...
DavidVY Posted March 24, 2016 Share Posted March 24, 2016 Selling around 10x EV/EBIT (gurufocus). Its selling around 20 P/E with huge tailwind of shanghai park opening soon, ginormous real estate investments (carried way below cost). The Disney machine is a money-suck that appeals to all ages, demographics and geographies. I foresee a huge runway ahead and ever increasing global demand for its products (giant middle class emerging in developing world). ESPN has great brand value. I don't really see it going anywhere long-term. Minor setbacks w/the content debundling issue imo. Link to comment Share on other sites More sharing options...
glorysk87 Posted March 24, 2016 Share Posted March 24, 2016 Selling around 10x EV/EBIT (gurufocus). Its selling around 20 P/E with huge tailwind of shanghai park opening soon, ginormous real estate investments (carried way below cost). The Disney machine is a money-suck that appeals to all ages, demographics and geographies. I foresee a huge runway ahead and ever increasing global demand for its products (giant middle class emerging in developing world). ESPN has great brand value. I don't really see it going anywhere long-term. Minor setbacks w/the content debundling issue imo. I disagree. ESPN has great brand value, sure. But brand value can only carry you so far. If you look at affiliate fees for various channels, ESPN is at the top of the list. Their affiliate fees are orders of magnitude higher than most other channels. The bulk of the channels out there charge between $1 and $2 per subscriber in affiliate fees. ESPN charges over $6. Add in the plummeting ratings and you have a very solid recipe for significant price declines at ESPN. I don't think it's crazy to say that the affiliate fees for ESPN should be closer to $4, or lower. That smashes the operating income derived from ESPN, which is a significant portion of Disney's Media Networks income. Link to comment Share on other sites More sharing options...
buylowersellhigh Posted April 4, 2016 Share Posted April 4, 2016 COO Stepping Down Disney's Operating Chief to Leave Company--2nd Update DOW JONES & COMPANY, INC. 4:22 PM ET 4/4/2016 Walt Disney Co. (DIS) said Chief Operating Officer Thomas Staggs, who had been considered a candidate for chief executive, will step down on May 6. Mr. Staggs will be a special adviser to Chief Executive Robert Iger through this fiscal year, which ends around the beginning of October. Reasons for his departure weren't immediately available. "With approximately two years left before Mr. Iger steps down as chairman and chief executive officer, Disney's(DIS) board of directors will broaden the scope of its succession planning process to identify and evaluate a robust slate of candidates for consideration," the company said. Mr. Staggs, who has been with Disney(DIS) for 26 years, was named chief financial officer in 1998 and held the post for 12 years. After that, he traded jobs with Jay Rasulo, then head of Disney's(DIS) parks and resorts division. The selection of Mr. Staggs as operating chief in early 2015 appeared to sideline Mr. Rasulo, his main rival for the CEO post. In June 2015, Disney(DIS) said Mr. Rasulo would step down. Later that month, it said Treasurer Christine McCarthy would become CFO. In February, Disney(DIS) reported record quarterly earnings on the huge box office for "Star Wars" and a 9% revenue increase at its theme-park segment. An important focus for investors has been the effect of "cord-cutting" on Disney's(DIS) cable business, particularly sports giant ESPN(DIS). ESPN(DIS) lost subscribers and higher programming costs, but Mr. Iger said in a conference call after the earnings report that ESPN(DIS) had experienced an uptick in subscriber numbers in recent months. Link to comment Share on other sites More sharing options...
rogermunibond Posted April 5, 2016 Share Posted April 5, 2016 It seems like both of the men who had been the presumptive heir-apparents for Iger would have failed the board's issues with content/creatives management. It seems like both Rasulo (Parks then CFO) and Staggs (CFO then Parks) while strong in operational experience and finance didn't have the backing of any of the following: WD/Pixar Animation Studios (Catmull and Lasseter), Alan Horn (WD Studios), Disney-ABC TV (Ben Sherwood). If that was the case, then it begs the question as to WHY? the board and Iger didn't have an internal creative exec who they could also move into Parks and then CFO to give them the full breadth of skills needed for the CEO job?! Link to comment Share on other sites More sharing options...
giofranchi Posted June 10, 2016 Share Posted June 10, 2016 I like DIS for almost the same reasons I like NKE, and I have opened a relatively small position. DIS today is cheaper than NKE, with a forward P/E of 16. And during the last 10 years it has increased earnings at an even faster CAGR than NKE: 15%. Just like NKE, DIS is very little indebted. What's not to like? Cheers, Gio Link to comment Share on other sites More sharing options...
LC Posted June 10, 2016 Share Posted June 10, 2016 welcome to the world of boring garpy stuff, geo :D i am also looking at disney Link to comment Share on other sites More sharing options...
fareastwarriors Posted June 15, 2016 Share Posted June 15, 2016 How China Won the Keys to Disney’s Magic Kingdom http://www.nytimes.com/2016/06/15/business/international/china-disney.html?action=click&contentCollection=Media&module=RelatedCoverage®ion=EndOfArticle&pgtype=article Link to comment Share on other sites More sharing options...
fareastwarriors Posted July 11, 2016 Share Posted July 11, 2016 When Walt went to China Disney’s theme park in Shanghai promises a ‘rain of renminbi’ — but also fuels paranoia about American cultural dominance http://www.ft.com/cms/s/2/f87b5de6-3895-11e6-9a05-82a9b15a8ee7.html Link to comment Share on other sites More sharing options...
JBTC Posted October 2, 2016 Share Posted October 2, 2016 Does anyone think sports is in a bubble? Team prices, tv deals, ticket prices, and just about everything else related to them. It seems like more average folks are big sports fans now than even 10-15 years ago. It almost seems like a fad for the average person. Curious if anyone has seen data on this - one would assume growth in sports is secular in general. If not, what factors could cause people to lose interest in sports over time? Link to comment Share on other sites More sharing options...
saltybit Posted October 6, 2016 Share Posted October 6, 2016 http://www.bizjournals.com/boston/news/2016/10/05/disney-ceo-bob-iger-says-why-netflix-twitter-could.html Link to comment Share on other sites More sharing options...
SlowAppreciation Posted October 6, 2016 Share Posted October 6, 2016 Does anyone think sports is in a bubble? Team prices, tv deals, ticket prices, and just about everything else related to them. It seems like more average folks are big sports fans now than even 10-15 years ago. It almost seems like a fad for the average person. Curious if anyone has seen data on this - one would assume growth in sports is secular in general. If not, what factors could cause people to lose interest in sports over time? http://www.wsj.com/articles/ratings-fumble-for-nfl-surprises-networks-advertisers-1475764108 Link to comment Share on other sites More sharing options...
Guest Schwab711 Posted October 6, 2016 Share Posted October 6, 2016 I think you could argue almost everything Disney owns/is tied to, maybe other than Disney/Pixar, could be in a bubble. Star Wars, super heroes, the NFL, ect. I can't see growth from here and there's no way to break up the company at this point. Disney Parks are the best asset they own. Link to comment Share on other sites More sharing options...
SlowAppreciation Posted October 6, 2016 Share Posted October 6, 2016 I think you could argue almost everything Disney owns/is tied to, maybe other than Disney/Pixar, could be in a bubble. Star Wars, super heroes, the NFL, ect. I can't see growth from here and there's no way to break up the company at this point. Disney Parks are the best asset they own. Might be a bubble, but I also think the movies and characters in the Disney profile are a pretty sure bet for the very long-term. I don't see a scenario where 30 years from now, Toy Story or Mickey Mouse or the Lion King are any less popular. So maybe you overpay now since today's prices are a little bubbly, but you probably do okay in the very very long term because of their brand staying power. Link to comment Share on other sites More sharing options...
RichardGibbons Posted October 6, 2016 Share Posted October 6, 2016 Curious if anyone has seen data on this - one would assume growth in sports is secular in general. If not, what factors could cause people to lose interest in sports over time? http://www.wsj.com/articles/ratings-fumble-for-nfl-surprises-networks-advertisers-1475764108 I watched an NFL game the other day, and it was painful how much advertising I was forced to watch, to the extent that I won't watch another game until possibly playoffs. I'm only one anecdotal data point--and are therefore meaningless--but I wonder whether Netflix and streaming are reducing people's tolerance for advertising, particularly kids who grow up almost never seeing a TV ad? If that's the case, even if the NFL product is as good as it ever was, fewer people might watch because the advertising is now intolerable to them. Link to comment Share on other sites More sharing options...
Spekulatius Posted October 6, 2016 Share Posted October 6, 2016 Curious if anyone has seen data on this - one would assume growth in sports is secular in general. If not, what factors could cause people to lose interest in sports over time? http://www.wsj.com/articles/ratings-fumble-for-nfl-surprises-networks-advertisers-1475764108 I watched an NFL game the other day, and it was painful how much advertising I was forced to watch, to the extent that I won't watch another game until possibly playoffs. I'm only one anecdotal data point--and are therefore meaningless--but I wonder whether Netflix and streaming are reducing people's tolerance for advertising, particularly kids who grow up almost never seeing a TV ad? If that's the case, even if the NFL product is as good as it ever was, fewer people might watch because the advertising is now intolerable to them. I don't watch NFL, but I just record sports events on my DVR and watch them with a ~30min time lag and fast forward over the advertisement blocks. I agree that these ads are unbearable, if you get attuned to streaming services. Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 7, 2016 Share Posted October 7, 2016 I'M WEIRD. I enjoy watching ads.... I know it's crazy. I like to see what companies are spending marketing $ on. I do find it annoying when the ads repeat within the same commercial segment! Link to comment Share on other sites More sharing options...
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