Disclaimer: Invest at your own risk. Not financial advisor, just a regard giving my 2 cents. Not responsible for any losses you may incur. I hope you are blessed with tendies 🙂
Disney’s valuation is ridiculous, and unless Apple buys it(there’s speculation they may with the most recent partnership), they’re cooked.
I know you’re supposed to “not bet against the mouse”, but right now it’s worth doing.
Here’s why:
1.) The only thing Disney is making substantial profits on right now is their parks. Even now, attendance numbers are down significantly this year compared to years past. I only expect the trend to continue for the reasons below:
2.)Disney is running out of animated movies to make live action adaptations out of, and they’re finally beginning to not turn a profit on the ones they are pumping out; The most recent of which being The Little Mermaid, which made its budget back, but ended up losing millions after marketing expenses.
To expand upon this, the live action adaptations being made aren’t very marketable in attracting people to the parks. The films themselves have only been good for nostalgic money, which comes from older audiences who wish to reminisce on good times. Kids aren’t excited to go to the parks because of that; And with that lack of excitement from kids, comes a lack of excitement from parents to bring their kids to the profitable, ridiculously expensive parks. Unless a kid really wants to go, parents won’t shell out the money to make it happen for them.
Disney has sunk so much money into Live Action animated adaptations over the last dozen years without thinking of the long term implications of not allocating money into diversifying and creating both original live action, and original animated properties(not sequels) that are GOOD(there are exceptions, but not many). Live action adaptations were profitable cash cow in the short term. Now, they reap what they sow.
3.) Marvel and Star Wars are pretty much depleted at this point for significant profits. New Disney+ shows and movies aren’t saving the clusterfucks these once massive franchise-able conglomerates have become. Terrible writing/creatively bankrupt ideas have tarnished each franchise’s once grand reputation(See most Marvel Movies/Shows Post End-game, and the Star Wars trilogy in general). With a tarnished reputation, comes tarnished profitability.
Speaking of bad writing and planning with once grand franchise properties, the most recent installment of Indiana Jones was also a colossal flop, losing 300+ million. Banking on Nostalgia can only get you so far.
4.)Even of the very few animated films Disney has put out, the most recent films have ranged from mid to bad. In the last year alone, Disney’s Strange World, Lightyear, and Pinocchio got ABSOLUTELY dunked on by Sony(Spiderverse), Dreamworks(Puss In Boots), and Del Toro’s Pinocchio(funnily enough) both in public reception and profits. Collectively, these three movies have lost Disney hundreds of millions of dollars.
The magic in the animation department is a shell of its former self, and by playing it safe and not investing in talent, creativity, and people who have the ability to tell a great story, Disney is getting left in the dust by companies that do.
5.)Disney+ is getting absolutely hammered in losses as the streaming bull run is over. The streaming wars have become so competitive, and with that over-saturated in the last 2-3 years. The lack of good, original programming being sent out currently does not justify the price point, even with the enticing proposition of the Hulu & ESPN bundle.
In conclusion: Disney has lost touch with what made it so great, their ‘Magic’, and they’re getting what they fucking deserve.
Tl;Dr: Running out of the soulless animated to Live action adaptations, with the ones being put out now finally not turning profits. Once seen as grand franchises have become unprofitable laughingstocks(Marvel, Star Wars especially) due to bad writing, another recent example being Indiana Jones, which lost Disney at least 300+ million. The only thing profitable for Disney are the parks which are losing attendance rapidly, and they can’t use the Live action movies they’ve been milking nostalgia profits on for years for park marketing/advertising purposes because it doesn’t get kids interested. Disney’s recent attempts at animated films are getting dunked on by rival companies because of a lack of creativity and risk taking, which they also lost hundreds of millions there too. Disney+ bull run is over as stream subscription numbers are declining rapidly, and their CEO has no direction for the company.
Disney to the floor.