In 2023, Disney (NYSE: DIS) faced extensive boycotts that significantly reduced its market capitalization and stock performance, with DIS stock hitting multiple lows in 2023, and erasing billions in market cap.
However, as of the beginning of 2024, Walt Disney stock has rebounded strongly, with its shares surging nearly 30%, to trade at $116.7 since the previous closing on March 21.
This situation highlights how rapidly market sentiment can shift and underscores the opportunities available to investors who closely monitor these changes.
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How much did DIS stock lose in the previous years?
Over the past three years, Walt Disney has faced significant challenges, and shareholders have felt the impact with the stock plummeting over 40% from its peak of $197 in early 2021.
The COVID-19 pandemic and subsequent boycotts are largely to blame for this decline. The pandemic accelerated the rise of competing streaming services such as Netflix (NASDAQ: NFLX) while dealing a lasting blow to the theatrical film industry. Like many others in the sector, Disney was caught off guard by the rapid and profound changes.
However, there appears to be a glimmer of hope on the horizon as DIS shares show signs of a slow but steady recovery. There are several reasons for investors to feel optimistic about Disney’s future, as Disney shares rose to a 52-week high in the past two weeks.
DIS stock recovery is well underway
There is no better way to analyze the company’s performance and future prospects than looking at its finances, and Disney reported quarterly revenue of $23.5 billion, which remained flat compared to the previous year.
This revenue breakdown included $10 billion from its Entertainment division, covering TV, film, and streaming businesses, $4.8 billion from Sports, which includes ESPN and Star, and $9.1 billion from Experiences, encompassing its theme parks, cruise line, and products.
Additionally, Disney’s overall operating income saw a notable 27% increase to $3.9 billion. This rise was partly due to the offsetting of a $103 million loss in the sports division by a more than doubling of income in the entertainment division, reaching $874 million this quarter compared to $345 million in Q1 2023.
The losses in the streaming division for the quarter decreased to $216 million, a significant improvement from over $1 billion a year ago.
The broader segments of the Disney industry also show promising prospects. Disney has at least one potential blockbuster slated for release every month this calendar year, beginning in May. Additionally, with new cruise ships and expansions in theme parks, this segment is expected to continue its stellar performance.
It appears that the results are already evident, as DIS shares have been consistently trading in positive territory for much of 2024, showing no signs of slowing down. This suggests that we could potentially see a new all-time high before 2025 if this trend persists.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
