Disney’s stock valuations of the past week have represented its lowest low since October 2014.
Key Details
- Disney’s closing prices on Thursday, Monday, and Tuesday have dipped to $84 per share, well below its historic valuation peak of $189 per share in February 2021.
- Valuations crashed on Thursday afternoon as low at $82.46 per share.
- Its stock valuation is currently $84.32 per share, which is down 5.3% year-to-date and an 18% decline over the past six months.
- Disney is the 78th worst-performing stock on the S&P 500 in the past 10 years and has shrunk from the 31st most valuable company in 2015 to the 69th this year, Forbes notes.
Why It’s Important
The Disney Corporation is in the midst of a tremendous slump, following some of the worst stock returns in 48 years in 2022, and currently sitting as one of the worst performers on the S&P 500 list.
Many factors have contributed to this outcome, from poor monetization of streaming services to a decline in traditional television advertising revenue, alleged claims of lower theme park attendance, multiple underperforming recent blockbusters, and a two-year-long legal feud and culture war battle with Florida Governor Ron DeSantis.
Previous company CEO Bob Chapek was ousted from the organization in November as a result of the profitability issues, with former CEO Bob Iger returning to his former position—immediately implementing significant plans to restructure the company, sell off assets, and laid off 7,000 staff to get the company to a point of profitability.
As we previously reported, the company’s third-quarter revenue report shows that Disney is halfway there. The business reported on August 10 that losses were narrowing from more than $1 billion per year to $500 million. The company also announced price hikes and password crackdowns against Disney+ subscribers.
Disney has even begun looking for artificial intelligence (AI) solutions to reduce costs and is considering spinning off and selling parts of its legacy television division that are proving unprofitable, drawing ire in the process from members of the ongoing SAG and WGA picketers who are actively fighting against replacing actors and writers with AI.
Notable Quote
“Mickey is going on a diet and losing weight,” says Daiwa analyst Jonathan Kees. “[Disney could be a] survivor and winner in the streaming wars.”
