Disney (DIS) is looking to continue off of Captain Marvel’s success with Avengers: Endgame debuting April 26th, 2019. Captain Marvel has already brought in more $1 billion in worldwide box office revenue and leading all 2019 movies by a wide margin. Disney is betting huge on Avengers: Endgame taking the torch to the $2 billion box office milestone, a feat that’s only been accomplished four times, one of them being Avengers: Infinity War last year with $2.05 billion. All the initiatives that Disney has taken over the previous two years to restore growth appear to be coming to fruition, namely its Fox (FOX) acquisition and it's streaming initiatives. The Fox acquisition is complete for the combined entity; thus Fox’s assets are now definitively being absorbed by Disney. Disney continues to invest heavily into its streaming services such as Hulu, ESPN Plus and it's soon to be released Disney branded streaming service that will directly compete with Netflix (NFLX). The Fox acquisition brings a majority stake in Hulu (60% ownership) while its ESPN Plus launched earlier this year and has over 2 million subscribers. Disney continues to dominate at the box office while posting great growth at its theme parks translating into robust and durable revenue streams. The company is evolving to meet the new age of media consumption demands of the consumer via streaming and on-demand content. Disney has been on an uptrend as of late, breaking through the $115 relative to an all-time of ~$120. I’ve been behind Disney for a long time, especially through this transition back to growth and I still feel that the company offers a compelling long-term investment opportunity given its growth catalysts that will continue to bear fruit over the coming years. Goldman Sachs recently championed Disney’s reinvention efforts and boosted its target price to $142, a 20% increase from the $115 current share price.
Goldman Sachs Backs Fox Acquisition and Future
Goldman Sachs has changed its view on Disney after the investment bank removed Disney from its buy recommendation in December of 2017. Now Goldman Sachs has come out to back Disney and labeled the stock as a buy. It's "the dawn of a new era" after the company bought the media assets of Twenty-First Century Fox, the acquisition which Goldman advised. Now the impending launch of Disney Plus marks a "momentous" shift in content monetization, though investors will need to be patient with some heavy lifting around the launch, suggests Drew Borst. Continue reading "Disney - Avengers: Endgame, Streaming, and Fox"