5 Jul 2022 2:34 pm
Xavier_Onassis » 04 Jul 2022, 11:28 am » wrote: ↑ Their target market for the parks is people with children, and most people with children are NOT in favor of "don't say gay" laws, and do not care one whit about whether Disney gets to politically control the Reedy Creek Improvement District or not.
The entire stock market, both bonds and stock are down/ Even gold and cybercurrencies are way down. The market is not based on earnings of the companies involved: it is based on what some people THINK OTHER investors will invest in based on future prospects.
Many investors believe that high gasoline and rising motel prices will result in fewer visitors to Disney. Will Disney go broke? Not much chance of that. They still have Pixar and their own films and YUGE amounts of real estate.
How do you make money on the stock market? Buy low, sell high.
Disney is selling at a rather low price. It is almost a sure thing that the price will rise sharply at some time in the future. Certainly within the next three years.
I think all the controversy still probably hasn't hit their bottom line to the extent to represent their painful loss in equity value. There is probably just a sell off due to the dislike of some investors of the controversy surrounding Disney. It is somewhat a dilemma for the company given the DeSantis move against Disney World and they probably aren't trying to be activists socially on a larger political sense. Its a tightrope with LGBT favorable views that they have to balance with those who disapprove of such marketing/activism. That puts them in a tight spot businesswise and the company is probably trying to please everyone at this point. Disney is a business after all and they probably worry about the negative publicity.
BTW, the bond market is actually up. Yields are stronger given the rise in interest rates. This means that bond prices are down because outstanding bonds have lower interest rates than the current issuance of treasuries which benchmark the market. Otherwise, bond prices going down is actually a sign of a higher return on bonds. The equity market is in bear market territory but that also means it is not time to sell. Hopefully when the market dips a little more I might be a buyer at some point too.
Nothing is easier than defending the status quo.