Today, I received my COVID Relief Jan 2021 stimulus check and I immediately knew what I needed to do.
Buy more Disney shares!
Disclaimer: I am not a financial advisor. I am simply sharing what I am investing in so please do your own research before investing your hard-earned money.
Disney+
Little did Disney know that a once-in-a-lifetime pandemic was going to drastically impact the world and force them to close all of their parks… for 9+ months. Let’s just say that their revenue taking a nosedive this year is putting it nicely.
But there is a shining light in the horizon and it is called Disney+.
Disney+ is a brand new streaming service that Disney launched on November 2019 and it has been an absolute saving grace for the company. Being able to watch Disney classics (nostalgia is a beautiful thing) and amazing movies from Pixar, Marvel, Star Wars, and several others from the comfort of your own home really makes Disney+ a force to deal with in the streaming war.
Why doesn’t Netflix have Pixar, Marvel, and Star Wars movies / TV shows?
Because Disney bought out those incredible entertainment assets. They own these brands.
Due to these amazing assets, Disney+ blew the doors open and their subscription growth has been growing at a rapid pace. The image above shows the subscription growth from Disney+ launch date to April 2020 (five months). They surpassed the 50 million subscribers mark in April 2020 when initially they thought they would reach 60-80 million subscribers by 2024. That’s correct. Disney+ has blown away the management’s expectations.
You are probably wondering what their subscription count is now.
Disney+ has reached 86 million subscribers at the end of 2020. Mind-blowing achievement and I expect this growth to go much further in 2021.
What really stands out with Disney+’s content is the quality of the TV shows and movies they are launching on their platform. I can tell that the management team at Disney realizes the incredible potential with their streaming service and they are convinced now to invest a much larger capital into it.
COVID-19 Vaccine
I’ll keep this one short.
As soon as we have herd immunity due to the COVID-19 vaccine, I expect a massive stock price jump as soon as Disney announces to the world that they are finally re-opening their parks.
Not only will they get back their huge revenue from their parks again, they will have Disney+ bringing in more money for them on the side.
2020 Investor Day Presentation
Yes, I spent more than 3 hours watching this presentation, but that’s what you need to do if you are thinking about investing into a single company.
If you do not feel like watching it, here are the big takes:
- Disney+ will raise their subscription price to $8 a month (adding more revenue into their pockets and from the content that they announced in their presentation, that price is definitely worth it).
- New bundle will offer Hulu Ad-Free and ESPN+ for $18.99 a month. Good deal for those who want all three streaming services.
- Disney+ is planning to add 50 new Marvel, Star Wars, Disney, and Pixar TV Series and Movies over the next few years.
- Disney+ currently has 86 million subscribers and they now project that they will reach a staggering 230 million to 260 million subscribers by the end of 2024.
Conclusion / Prediction
Disney has a bright future and their entry to the streaming war and reopening of their parks is going to grow this company at an incredible rate.
My Prediction: I’m expecting Disney’s stock to be worth over $200 per share by the end of 2021.
The only unfortunate thing about Disney stock is that they are currently not paying dividends to their investors (due to their parks shutting down and the company has been outright bleeding money) but once the COVID-19 nightmare goes away, I expect Disney to go back to paying dividends to their shareholders. With Disney+ being their brand new golden goose, I expect some serious dividend growth and as a dividend investor, I’m excited for what they will be handing out to their investors for sticking through.
I’m excited for Disney’s future.
I’m long DIS.
