Morgan Stanley picked the Walt Disney Co (NYSE: DIS) and Netflix Inc (NASDAQ: NFLX) as its top media plays on Thursday, despite people now spending less time indoors as the COVID-19 restrictions continue to ease.
The past two quarters have been rough for both companies from the stock perspective. Morgan Stanley’s Benjamin Swinburne, however, attributes the unexciting stock performance to tough comparisons as Disney and Netflix had a fantastic run last year when the pandemic was at its peak.
Now that the comparisons are getting easier, the investment bank expects the streaming giants to “outperform” into the end of the year. Morgan Stanley analysts also cited the strong content slate Disney and Netflix have for the bullish call on the two stocks.
Matt Maley picks Disney as his favourite
On CNBC’s “Trading Nation”, Miller Tabak’s Matt Maley agreed to Morgan Stanley’s stance on both companies but picked Disney as his personal favourite on a technical basis.
“If Disney breaks meaningfully below its 200-day moving average, it’ll raise a big yellow flag, and I’ll change my stance on the stock. But last fall, when it finally broke above that 200-day moving average, it exploded to the upside and rallied 50% over the next four or five months,” Maley said.
Disney’s 200-day MA currently stands close to $178, and Maley is waiting for a break above $184 that he says will invite “momentum money” that will push the stock up.
Why Delano Saporu likes Netflix better
During the same interview with CNBC, New Street Advisors founder Delano Saporu also said he saw potential in both Disney and Netflix over the long term, but disclosed having more exposure to Netflix.
“There’s a lot of opportunities for investors to buy for the long term, especially since they’re trading nine times sales and 53 times earnings on a trailing 12 months basis, so I really like Netflix. I think there’s a lot of reasons that investors should be excited,” he added.
Shares of Disney are up 1.0% on Friday, while Netflix isn’t much bothered.
The post Disney vs Netflix: traders pick sides after Morgan Stanley’s bullish call appeared first on Invezz.
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