DIS Charming Mouse
I would go out to Disney tonight … but I haven’t got a stitch to wear.
This Mouse said: “It’s gruesome … that someone like Great Stuff should caaaaare!”
Is that … The Smiths? It’s too early for Morrissey. Like, always.
It’s a deeper cut, Great Ones, but it checks out. And speaking of Wall Street’s charmer of charmers, today is Walt Disney (NYSE: DIS) Day here at Great Stuff.
Before you go packing for a road trip … we’re only headed to the earnings confessional.
The House of Mouse just blasted analysts’ estimates across the board, if you couldn’t tell by DIS stock’s near-7% rally before the Magic Kingdom even opened today.
First up, the headline figures:
• Per-share earnings: $1.06 versus $0.63 expected.
• Revenue: $21.82 billion versus $20.91 billion expected.
See? Who serves up a double beat like Disney?
Before we get into the nitty gritty of Mickey’s trickery, remember what we’re actually looking for this quarter.
Just Monday, you should’ve read Great Stuff’s expectations for DIS this week. And if you don’t know what I’m talking about, don’t worry, it just means you need more Great Stuff on the regular.
I’m not offended or hurt, but I do expect you to read everything from now on. Anyway…
All us DIS investors out here have but one thing on our minds — other than that one dang song from Encanto. It’s streaming. So. Much. Streaming:
Well, speak of Cruella. Disney+ added 11.8 million new subscribers in the last quarter, while analysts expected just under 7 million subscriber adds.
What’s more, Disney CEO Bob Chapek reiterated guidance for 230 million to 260 million Disney+ subscribers by 2024, saying he’s “more confident than ever in this platform.”
Remember, Disney+, Hulu and ESPN+ combine to form the largest streaming base in the world, like a massive media Voltron.
With Netflix’s (Nasdaq: NFLX) subscriber guidance dropping like a stone for the coming quarter, it appears that the Disney behemoth isn’t experiencing post-pandemic subscriber churn like Netflix seems to be.
Disney’s snowballing digital media empire continues to … you know … snowball, even as pandemic restrictions ease and people touch grass again.
Because as Great Stuff Picks readers in DIS know, there’s another part of the Disney moneymaking flywheel — mouse wheel? — that is back and booming. A lucrative source of cash for the kinda digital expansion that Netflix could only dream of: park revenue.
Revenue over at Disney’s parks, experiences and consumer products division doubled year over year, reaching $7.2 billion last quarter as more guests visit the parks, stay in branded hotels and book Disney cruises.
Not to mention, this is without the droves of international visitors, which made up a fifth of all park guests pre-pandemic. Disney’s got that gift shop cash a-flowing once more, and this is just the start of the parks’ post-pandemic prowess.
People want to go out (shocker), even if it’s just for a Dole Whip at Disney. And yet, the media habits people formed during the pandemic remain steady … as long as you’re not named “Netflix.”
So, all told, we have better-than-expected Disney+ subscriber adds. Streaming revenue is up. Park attendance is soaring and has yet to reach full stride — especially when it comes to international visitors.
But — and you knew there would be a “but” — all y’all DIS investors aren’t out of the woods yet.
Disney+ has huge premieres slated for the current quarter but is still chewing through its content production pipeline.
The company also plans to increase production and programming expenses by $800 million to $1 billion, or about the cost of a week at the Magic Kingdom.
There’s EPCOT if you’d like to go … you could meet somebody who really loves Disney…
You and I both know that spending on content is a boon for Disney long term — Disney has a much better track record for the cash it dumps into production than, say, oh, I don’t know, Netflix. But Wall Street?
Don’t be surprised if analysts fret and fuss over that spending in the meantime. At least until Disney drops another streaming bombshell like today…
Keep holding, all you Great Stuff Picks readers in DIS.
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Are you ready to rumble, Great Ones?
In one corner, we have food and beverage brewer Coca-Cola (NYSE: KO). In the other, we have Wall Street’s notoriously tough earnings expectations.
The two contenders take center stage … a brawl breaks out … Cola-Cola delivers a swift jab to the upper jaw … and just like that, it’s over! Coca-Cola wins again, and the crowd goes wild!
OK, so Coke’s earnings announcement wasn’t that exciting. But Big Red did manage to beat Wall Street’s earnings and revenue projections — and that’s saying something, considering so many other companies are crying wolf over rising inflation eating into their profits.
Instead, the beverage behemoth reported $9.46 billion in revenue over the last three months, backed by strong sales for its sparkling soft drink segment, including Coke Zero. Apparently, people still love their soda pop. It’s surprising stuff, I know.
Still, congrats to all you Coca-Cola stockholders out there enjoying today’s 0.72% rise. KO stock may not move very quickly … but damn if it doesn’t move in the right direction.
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Twitter (NYSE: TWTR) shareholders really want the social media stock to take its broken wings and learn to fly again, learn to live so free. And it is … kinda sorta.
In case you missed it, Twitter took to the earnings confessional this morning and delivered weaker-than-expected revenue and earnings. Per-share earnings came in $0.02 short of the mark, while revenue reached $1.57 billion versus the $1.58 billion analysts anticipated.
But what about new user growth?
Swing and a miss, my friend. Even though Twitter said it made “meaningful progress” toward its 315 million user goal — which it has until 2023 to deliver on — the social media company barely scraped the 217 million user mark.
But you wanna know what Twitter does have going for it? Why, it’s a $4 billion stock buyback program! Oh boy, here we go.
Longtime readers already know our feelings on stock buybacks. They basically indicate that a company has nothing better to spend its money on … which clearly isn’t the case for Twitter, if its latest earnings report is anything to go on. (Hint: It is.)
Twitter, like many of its older social media siblings, clearly has some issues it needs to address if it wants to stay competitive against the new kids on the block *cough TikTok cough.* But sure, let’s spend $4 billion on stock buybacks instead of fixing what isn’t working.
All that said, stock buybacks tend to make investors happy, which is why TWTR rallied incrementally despite its earnings letdown. Still, there’s a fine line between confidence and stupidity … and Twitter’s walking the tightrope.
Hail to the ride-sharing chief!
Uber (NYSE: UBER) gained more than 4% this morning after releasing fourth-quarter earnings that show the company’s bouncing back from earlier coronavirus headwinds.
Here’s how Uber’s two business segments faired in the fourth quarter: Mobility revenue reached $11.3 billion, up 67% year over year. Delivery revenue hit $13.4 billion, up 34% year over year.
Surprisingly, Uber Eats remains the company’s most profitable and fastest-growing division, despite the fact that people are free to go outside again and even … dare I say it … pick up their own food orders.
Pick up my own food? What is this, the Stone Age?
While Uber and other food deliverers ran the risk of waning demand post-pandemic, it looks like customers and businesses alike are loath to give up Uber’s uber convenient services.
I don’t know about you, but I’ve had enough pizza and Chinese carryout to last me a lifetime and quite enjoy having more delivery options available.
Try cooking at home, you say? Ain’t nobody got time for that…
Since certain Great Ones are bummed we don’t mention bank stocks more often, we decided to toss Credit Suisse (NYSE: CS) into the Great Stuff bonfire this morning … and boy, did those shares go up in a blaze.
You see, Credit Suisse ended the fourth quarter down more than $2 billion. The Swiss bank blamed a broad slowdown in borrowing and investing activity — not to mention business culture improvements — as the main factors impeding its balance sheet.
Reading between the lines, Credit Suisse is clearly still being haunted by the Archegos Capital Management hedge fund scandal, which forced the bank to restructure its business and “reduce its risk appetite” after Archegos defaulted on a whole bunch of margin calls.
Adding insult to injury, most other bank stocks are up this year because of rising interest rates that make it easier for banks to earn money from their lending businesses.
But Credit Suisse? Its stock is down almost 7% on the year … and today’s $2 billion blow certainly isn’t helping matters.
No wonder CS stock sank beneath the day’s red tide.
And with that, I hand it over to you, Great Ones! If you have any lingering market questions, investing what-ifs or oddball rants rumbling ‘round your noggin, why not drop us a line?
GreatStuffToday@BanyanHill.com is your home for hot takes and spit takes, investing questions and random market tomfoolery too. Whatever you want to write, we want to read!
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Until next time, stay Great!
