Disney Stock Bucks Market Downturn, Rising 3% As Wall Street Applauds Quarterly Numbers, Rebound Of Theme Parks
11.02.2022 - 00:22
/ deadline.com
Disney’s strong quarterly numbers, especially the rebound of its theme parks to 2019 levels of revenue and operating income, propelled a 3% gain for its stock despite the gloom on Wall Street.
The stock, which is a Dow component and a bellwether for consumer sentiment, finished at $152.25. It extended its rally from mid-January, when it slipped below $130 to establish a new 52-week low. The upswing came despite a 2% decline for both the Dow and Nasdaq, mostly due to fresh inflation worries.
After the close of trading on Wednesday, Disney reported that its flagship Disney+ streaming service had just shy of 130 million subscribers as of the January 2 end of the quarter. That tally surprised analysts, who were expecting a number closer to 125 million. Theme parks, though, given how vital they are to the overall company, have been the main driver of investor enthusiasm, managing to recover to a pre-Covid state of health. Attendance at U.S. sites rose by double digits over the prior quarter, and per-capita spending shot up 40% compared with the same period in fiscal 2019. Overall parks revenue came in at $7.2 billion, with operating margins at 34%.
Analysts, no matter what their view is of the long-term potential for Disney shares, saluted the quarterly results. Michael Nathanson of MoffettNathanson called the quarter a “massive surprise,” especially the performance of the parks unit. He maintained his “neutral” rating on the stock, however.
“On the face of it, the Disney+ numbers looked good with 11.7 million net additions,” he wrote in a note to clients. There were significant caveats, though — 2 million of the subscribers came via a bundle with Hulu + Live TV and another 2.6 were on Disney+ Hotstar, which gives Disney+ to