The Walt Disney Company (NYSE: DIS) reported its strongest quarter since the start of the pandemic last night, but the numbers weren’t enough for Michael Nathanson. Reiterating his ‘neutral’ rating on Disney with a price target of $185, the MoffettNathanson senior research analyst said on CNBC’s “Squawk Box”:
“The real valuation driver is Disney Plus, and under the numbers, you see that growth in Disney Plus is really slowing down in developed markets. It feels to us that the products hit maturity pretty quickly.”
Engine Media’s Tom Rogers is sceptical on Disney Plus
Engine Media’s Tom Rogers also agrees with Nathanson’s outlook. In a separate interview with CNBC, he acknowledged that the headline number for Disney Plus subscribers was encouraging but said the market was neglecting that much of the growth came from India, which are very low revenue subscribers.
“We didn’t get a new subscribers number in terms of incremental growth in the U.S. We came away after Disney through all this high-energy movie power putting their foot on the gas as capex said, and we didn’t find out what did that do in the domestic U.S. market in terms of their big story, Disney Plus. So, I came away a bit more sceptical,” Rogers said on Squawk Box.
Alan Gould lauds Disney for turning a profit from its parks segment
On the contrary, however, Loop Capital’s Alan Gould had a more positive tone for Disney on CNBC’s “Squawk on the Street”. In particular, he said it was a huge milestone in COVID for the company’s parks segment to turn at least slightly profitable in the recent quarter.
“Domestic parks at about two-third of business that they did in June 2019 quarter, which to me, is pretty good. There is a delta-related risk, of course, but the advanced booking seems strong, so I’d say that the parks segment is doing quite well domestically, at least for now,” Gould remarked.
The post Here’s why these two analysts aren’t convinced of Disney Plus growth appeared first on Invezz.
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Wajeeh Khan
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