This is a step-by-step stock review to answer the question, is Disney (DIS) stock a good buy?
This article will teach you how to use the 4Ms of investing. This will be a detailed walkthrough to show you how the 4Ms work and why they are important. If you are interested, you can log into Tykr to use the 4M Confidence Booster (Powered by OpenAI) which will allow you to complete a 4M Analysis in less than 60 seconds.
What are the 4Ms?
- MOS (Margin of Safety) – The MOS is the math part of investing which includes the Summary, Score, and MOS (Margin of Safety).
- Meaning – The meaning is the business model and how scalable the revenue streams are.
- Moat – The moat is how the business compares to other companies in the same Sector and Industry.
- Management – The management is the track record of the CEO.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
Table of Contents
The following links will direct you to key topics to help answer the question, is Disney (DIS) stock a good buy?
1. Disney Company History
When investing in stocks, it’s important to know the company’s history. This helps us understand the various revenue streams, if they acquired other companies, how they grew through difficult times, and how they separated themselves from the competition.
- Founded in 1923 by Walt Disney and Roy O. Disney as Disney Brothers Studio.
- 1928: Created Mickey Mouse, debuting in “Steamboat Willie,” the first synchronized sound cartoon.
- 1937: Released “Snow White and the Seven Dwarfs,” the first full-length animated feature film.
- 1955: Opened Disneyland in Anaheim, California, the first-ever theme park.
- 1966: Walt Disney passed away, but his legacy continued with innovative projects.
- 1971: Opened Walt Disney World Resort in Florida, expanding the theme park concept.
- 1983: Launched Disney Channel, entering the television market.
- 1995: Acquired ABC and ESPN, diversifying its media holdings.
- 2006: Acquired Pixar Animation Studios, enhancing its animation capabilities.
- 2009: Acquired Marvel Entertainment, bringing iconic superheroes into the Disney fold.
- 2012: Acquired Lucasfilm, gaining rights to the Star Wars and Indiana Jones franchises.
- 2019: Launched Disney+, a streaming service, transforming digital entertainment.
- Sustainability: Focuses on environmental responsibility with initiatives to reduce carbon footprint and waste.
- Community: Invests in children’s hospitals, education programs, and disaster relief efforts.
- Today: Operates in various sectors including film, TV, theme parks, and merchandise, with a global presence.
Disney’s history is a story of innovation, growth, and magical storytelling. From animation to theme parks and beyond, Disney continues to enchant audiences worldwide with its timeless magic and commitment to excellence.
2. MOS (Margin of Safety)
When investing in a company, the first step is to look at the financials. Fortunately, Tykr does this for us automatically. The higher the score, the stronger the financials and the safer the investment. The higher the MOS, the higher the potential returns you can make.
- Summary: overpriced
- Score: 22/100
- MOS: 1%
To see the most up-to-date Summary, Score, and MOS, please log into Tykr.
3. Meaning
When investing in a company, it’s important to know how a company makes money. A mature business model has multiple streams of revenue which allow the company to weather downturns in the economy.
Here is how Disney (DIS) makes money:
- Making money from ticket sales at theme parks like Disneyland and Disney World.
- Selling merchandise like toys, clothing, and accessories featuring Disney characters.
- Earning revenue from box office sales of movies produced by Disney Studios.
- Generating income from TV networks like ABC and ESPN through advertising and subscription fees.
- Offering streaming services like Disney+ and Hulu, where subscribers pay monthly fees to access content.
- Licensing Disney characters and properties for use in products, games, and attractions
Disney uses these various streams to maximize their earnings and provide diverse services to moviegoers.
Here are a few of the other companies that Disney has acquired over the years. This is important because a company will use a “Buy before build” philosophy to go to market faster and add additional streams of revenue. A company with more revenue streams has a more stable business model. Keep in mind, that most companies don’t build new software because it takes too long to go to market and generate revenue.
- Pixar Animation Studios
- Marvel Entertainment
- Lucasfilm
- 21st Century Fox (assets including 20th Century Fox, Fox Searchlight Pictures, FX Networks, and more)
4. Moat
When investing in a company, it’s important to understand how a company ranks against other companies in the same sector and industry. Based on the Score, here is how Disney (DIS) stacks up against other companies.
- IMAX Corporation. (IMAX) – 89
- Cinemark Holdings, Inc. (CNK) – 72
- Bowlero Corp. (BOWL)- 67
- Live Nation Entertainment, Inc. (LYV) – 67
- Lions Gate Entertainment Corp.(LGF-B)- 61
- The Walt Disney Company. (DIS) – 22
To see the most up-to-date Summary, Score, and MOS and each stock, please log into Tykr.
5. Management
When investing in a company, it’s important to understand who the CEO is, what they have accomplished in the past, and how they have helped this company grow. Good leaders typically have stronger cultures, less turnover, and better returns in the stock market.
- Bob Iger became CEO of Disney in 2005.
- He expanded Disney’s portfolio by acquiring major companies like Pixar, Marvel, Lucasfilm, and 21st Century Fox.
- Iger launched Disney+, a successful streaming service that quickly gained millions of subscribers.
- He oversaw the revitalization of Disney’s theme parks, including the opening of Shanghai Disneyland.
- Iger focused on creating high-quality content, leading to major box office successes for Disney films.
- He emphasized technological innovation, enhancing digital and animation capabilities.
- Iger strengthened Disney’s global presence, increasing its reach in international markets.
- He integrated ESPN more deeply into Disney’s business, expanding its sports media presence.
- Iger prioritized corporate culture, promoting creativity and collaboration within Disney.
- Under his leadership, Disney’s market value and revenue grew significantly, solidifying its status as a global entertainment leader.
6. 4M Score
All of our homework on this company leads up to the 4M Score. A lot of investors only look at the numbers. Yes, it’s important to look at the first M (MOS) which is the math part of investing but it’s also important to look past the numbers and also look at the Meaning, Moat, and Management. If all 4Ms pass, we should have high confidence in buying this stock.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
👉 The 4M Score of Disney (DIS) is 41/100.
To see the most up-to-date 4M Score, please log into Tykr.
7. Is Disney (DIS) stock a good buy?
Some of the top questions investors can have is Disney (DIS) stock a good buy or should I buy Disney (DIS) stock?
Investing in Disney can be a strong choice. Disney is a global entertainment powerhouse with a diverse portfolio, including theme parks, movies, TV networks, and streaming services like Disney+. Its iconic brands and characters generate steady revenue streams. Disney’s expansion into streaming is driving significant growth, and its creative content pipeline ensures future success. However, factors like economic downturns and competition in the streaming market can impact performance. Thoroughly researching these elements will help you make an informed decision about investing in Disney.
—
To truly know if Disney is a good stock to buy or sell, we recommend you log into Tykr. Within seconds you can see the Summary, Score, MOS, and 4M Score.
If you found this stock review interesting, you may also like this review on Apple.