- A brief look at the Q4 earnings shows that the company is holding up well financially even though the parks and studio division are having difficulties.
- The company has created a distribution structure that will determine how content is sold in the marketplace.
- This new distribution team will evaluate the best option for maximum ROI, even if it means some content will bypass theaters and go straight to streaming.
- D+ subscriber count hit 73 million, a great number considering the streaming service’s short existence, and it is a very significant part of the reason for the stock’s premium.
- The shares are expensive and are only for long-term shareholders, not those with a deep-value and/or shorter time frame.
It’s becoming clearer every day – Disney (DIS) is a streaming company. Even once vaccination processes reach a critical mass of efficacy, the company will be leveraging its D+ service with an eye toward positively affecting its stock valuation and cash flows.
But that is to come. Now, the company is highly focused on maintaining as much financial strength as it can as its parks and studio units continue to experience diabolical decimation (along with that decimation comes a suffering merchandising operation, since those two segments help to cross-promote the company’s ancillary-product offerings).
The company reported Q4 and full-year numbers on November 12. Expectations were exceeded, cash flow was firmly positive, and CEO Bob Chapek struck a positive tone during the earnings call… especially, not surprisingly, in support of the direct-to-consumer strategy.
