Why is DIS a buy?
The other day I'm watching CNBC as I do about three-four days per week thanks to the innernet. Kevin OLeary was panel guest and was asked about DIS. What he said isn't relevant. While chatting, they flashed NFLX across screen.
If you compare prices of DIS and NFLX, you will see NFLX costs ~3x as much to buy per share. If you look at shares outstanding, you will see DIS is at ~3x the amount of outstanding shares (simple supply demand surface overview). This makes sense.
Maybe comparing DIS and NFLX is not making any sense to you right now. Wait a minute. DIS streaming service revenue, which does not exist until 2019, had not been calculated into DIS price yet.
While NFLX is only streaming content, DIS is so much more, not to mention a easy Wall Street bet that is already valued equivalent to such a big market player as NFLX.
I personally am targeting a PT of $230/sh for Disney (this means my PT for NFLX is $345 as of 9:22 AZ TIME), once DISNEY streaming value has been realized. Now, understand that this may not be realized until HULU can no longer stream content owned by DIS.
*These are the authors opinions only. The author holds no direct positions in DIS, but is beginning accumulation phase of both BUY and CALL. Please seek a fiduciary for any professional investment advice. There are many other financial indicators including P/E that must be evaluated before making market decisions.