Is Disney going broke

[Aluminum Falcon]

I don't know AF.... I am finding myself agreeing with you, and that alone means that we are likely at the end of times, LOL.

Seriously though.... IMHO I think you are right that it's not going to be as bad as the '08 recession. There are a lot of different factors that do not compare and work in our favor. However, I DO think that discretionary income is going to drop, and that people will have to start making cuts putting a park visit out of reach for many who it was previously achievable.

Of course, we all know that parks is only a percentage of Disney and does not make up all their profit. Plus, that's almost entirely a WDW issue only. The recession itself won't affect Disney+ for example much, if at all. Other factors however, will. They need to seriously start putting up more new content.

I do believe that the recession will impact Disney overall though (Parks, DVC, DCL, and Movie Production will all suffer from cuts to discretionary spending for example). That will have a drag on Disney's numbers. I don't think it's going to kill Disney. But it is going to be an albatross around the neck of their stock price for some time to come.

After all, how much the recession actually affects Disney is not the issue. Investors confidence in how much they believe it will affect Disney IS, and right now, investors are squeamish.

i think the saying is that the market reacts to a recession before it happens, so Dis may start to recover as soon as the recession is confirmed, but we shall see

 

[TiggerBouncy]

i think the saying is that the market reacts to a recession before it happens, so Dis may start to recover as soon as the recession is confirmed, but we shall see

It's certainly possible. As you point out, the market is forward-facing. At this point, I think the idea of a recession is baked in to any factoring. The real question that will have a significant positive impact on Disney's stock is any news that allows people to frame the extent of the recession. I.E. once everyone has a feel for how long the damage will last, they will be more confident in dropping dollars into Disney's lap.

The problem is right now, the punches keep coming and no one has any idea when they will slow down, much less stop. The stock market deals in predictability. At least the traditional stock market does. With the Robin Hood crowd, all bets are off.

 

[AvidDisReader]

And the sky will fall, and the reservoirs will dry up haha. I think you are being a little over the top dramatic. I agree we are headed for, if not already in a recession, but i doubt it will look like 09’, employees are at a premium right now, which we haven’t seen in quite a while, so I doubt unemployment will take off, there may be other issues for the standard household, but probably not like the “whopper” you’re describing. I doubt it’s much of a drain on Dis but time will tell

When someone like Jamie Dimon predicts there is a Hurricane coming (referring the the coming Recession) it is not at all being dramatic. Everyone is entitled to their opinion. Just do not go crying when it hits and you did not take the warning.

 

[Aluminum Falcon]

When someone like Jamie Dimon predicts there is a Hurricane coming (referring the the coming Recession) it is not at all being dramatic. Everyone is entitled to their opinion. Just do not go crying when it hits and you did not take the warning.

every year there are economists, stock analysts, billionaire tycoons, politicians, ect. calling for or against recessions. Someone is going to be wrong one way or another. I'm not saying there won't be a recession, all i'm saying is that people proclaim terrible things, and great things are coming, A LOT, and most of the time it settles somewhere in the middle

 

[thealtonroute1982]

Bearish sentiment seems to be spreading rapidly. I bet when people feel and/or are less wealthy, they will visit WDW much less. So that might solve the overcrowding problem.

 

[Aluminum Falcon]

Bearish sentiment seems to be spreading rapidly. I bet when people feel and/or are less wealthy, they will visit WDW much less. So that might solve the overcrowding problem.

For the short term, that’s definitely possible

 

[john7994]

When someone like Jamie Dimon predicts there is a Hurricane coming (referring the the coming Recession) it is not at all being dramatic. Everyone is entitled to their opinion. Just do not go crying when it hits and you did not take the warning.

"We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful." - Warren Buffett

 

[thealtonroute1982]

"We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful." - Warren Buffett

It might be a long way down. But there will be buying opportunities.

 

[john7994]

It might be a long way down. But there will be buying opportunities.

And sadly for those of us severely impacted by that trip down - i mean those struggling to keep afloat, fed, and housed in a potentially recessionary economic downturn; there is no glee (at least on my part) in that investor axiom.

 

[drenalin'junkie]

Disney market cap is nearly half what it was 15 months ago, not the best sign but far from a death knell.

 

[AurumPunzel]

I don't guess it can broke, because of huge fanbase , and popularity. They just can't loose it all.

Whether they can continue to stomach the price rises and the controversial Genie+ amidst the cost of living borne by the current state of the world, not to mention other factors, remains to be seen. Disney has weathered various crises before, but given how unprecedented current events are, it's all an unknown.

 

[Sweettears]

Whether they can continue to stomach the price rises and the controversial Genie+ amidst the cost of living borne by the current state of the world, not to mention other factors, remains to be seen. Disney has weathered various crises before, but given how unprecedented current events are, it's all an unknown.

I’m not sure today’s events are unprecedented.

 

[AurumPunzel]

I’m not sure today’s events are unprecedented.

It's in terms of history that it is. Disney's dealt with the Great Depression, WW2, the numerous crises during the Cold War, corporate politics in the Card-Miller era, the early 90s recession, the EuroDisney fiasco, the WDAS post-Renaissance box office slump, the credit crisis of the late 2000s, and of course, the current global events. However, the impact is even greater as there's more simultaneity in the factors, which includes the rising cost of utility (hence allegations that Disney have been turning down the A/C in their buildings), supply chain issues, and even middle-classes being squeezed amidst grappling with a combination of rising costs of living and stagnating wages. Not to mention controversies surrounding Bob Chapek's corporate decisions.

 

[Suger Mag]

I almost think that some folks hope for the worst lol... they def. look for the worst.

For every report that something went wrong... there are reports of great times. Sadly folks seem to really want to concentrate on the negative... look for it, even hope for it sometimes. This is not just about just WDW, I see this about so many things. maybe it is a symptom of pandemic fatigue, or constant media and people's unrealistic expectations... or a combination.

People take a moment in time... and then translate that as canon for all time memorial. Are you really walking around with a temp gauge? collecting data on every store, attraction, transportation? No... it is just a person's subjective feelings at a moment in time... not very scientific way to draw a conclusion that led to 'No AC and Disney is broke".

I go to the parks about once a year (Thank you DVC since 2009) ... went to pandemic Disney, and will be back for 2023. Every time was great, we made memories, we spent time together, we laughed and got sore feet, and spent way to much money always. Was every time a clone of the previous year? nope. Was everything perfect? Nope. Did I expect it to be perfect and magic extra pixie dust FPs being handed out every time I had to wait for a bathroom? Nope. Did I expect the exact same WDW in 2020 as I did in 2018 or 2009? Nope. Do I have my "rose colored glasses" on? Nope. I just found that life is so much more enjoyable if you dont try to pick apart everything, take the ups and the downs... concentrate on the ups.

Disney.... WDW will be fine in the long run. Will the road be smooth and without bumps and potholes? Nope

 

[Sweettears]

It's in terms of history that it is. Disney's dealt with the Great Depression, WW2, the numerous crises during the Cold War, corporate politics in the Card-Miller era, the early 90s recession, the EuroDisney fiasco, the WDAS post-Renaissance box office slump, the credit crisis of the late 2000s, and of course, the current global events. However, the impact is even greater as there's more simultaneity in the factors, which includes the rising cost of utility (hence allegations that Disney have been turning down the A/C in their buildings), supply chain issues, and even middle-classes being squeezed amidst grappling with a combination of rising costs of living and stagnating wages. Not to mention controversies surrounding Bob Chapek's corporate decisions.

All of the things that are occurring today have happened in the past with the possible exception being climate change which disputes the tag of unprecedented

 

[Aluminum Falcon]

It's in terms of history that it is. Disney's dealt with the Great Depression, WW2, the numerous crises during the Cold War, corporate politics in the Card-Miller era, the early 90s recession, the EuroDisney fiasco, the WDAS post-Renaissance box office slump, the credit crisis of the late 2000s, and of course, the current global events. However, the impact is even greater as there's more simultaneity in the factors, which includes the rising cost of utility (hence allegations that Disney have been turning down the A/C in their buildings), supply chain issues, and even middle-classes being squeezed amidst grappling with a combination of rising costs of living and stagnating wages. Not to mention controversies surrounding Bob Chapek's corporate decisions.

I would argue that WWII and the Great Depression were bigger hardships then now a days, I mean we don’t have bread lines, and or rationing/ turning businesses into war production facilities ie Disney at the time.

I think you may be trapped in the “we have it worse, because we are living it currently” model that a lot of people fall into, you just have to remeber that every genetation has its own major problems.
For instance if you were born in 1920,you survived a pandemic, grew up in the Great Depression, probably fought in world war 2, possibly Korea, witnessed Vietnam, the 70’s crazy inflation, ect. It’s all about perspective

 

[lugnut33]

Well I'm a business MBA but thanks for the insightful take on how businesses make money. I wasn't addressing the profit/loss aspect but rather that the replies were discounting the validity of the referenced article which was 100% accurate.

That's because Brietbart is garbage.

 

[AurumPunzel]

I would argue that WWII and the Great Depression were bigger hardships then now a days, I mean we don’t have bread lines, and or rationing/ turning businesses into war production facilities ie Disney at the time.

I think you may be trapped in the “we have it worse, because we are living it currently” model that a lot of people fall into, you just have to remeber that every genetation has its own major problems.
For instance if you were born in 1920,you survived a pandemic, grew up in the Great Depression, probably fought in world war 2, possibly Korea, witnessed Vietnam, the 70’s crazy inflation, ect. It’s all about perspective

It's how more interconnected society has become (and how institutions have grown so big) that's adding new dimensions to the present crises. The Great Depression, WW2, 1970s oil crises and the Gulf War all happened before we had social media, and long before the economy evolved to its present form.

Fast forward to this century. The late 00s credit crash brought down many financial institutions, and led to the most unprecedented intervention in modern history. All caused by banks carelessly lending to anyone regardless of their scores, and particularly to first-time homeowners who were for the first time experiencing a housing market already priced in 6 figures, compared to previous decades. And since then, wage growth has been very slow; the lingering effects becoming more apparent today, as inflation soars, and that's beginning to hit Disney hard with many being priced out of a vacation due to the cost of living skyrocketing.

 

[Aluminum Falcon]

It's how more interconnected society has become (and how institutions have grown so big) that's adding new dimensions to the present crises. The Great Depression, WW2, 1970s oil crises and the Gulf War all happened before we had social media, and long before the economy evolved to its present form.

Fast forward to this century. The late 00s credit crash brought down many financial institutions, and led to the most unprecedented intervention in modern history. All caused by banks carelessly lending to anyone regardless of their scores, and particularly to first-time homeowners who were for the first time experiencing a housing market already priced in 6 figures, compared to previous decades. And since then, wage growth has been very slow; the lingering effects becoming more apparent today, as inflation soars, and that's beginning to hit Disney hard with many being priced out of a vacation due to the cost of living skyrocketing.

I don't think looking into macroeconomics is worth diving into on this one, we just don't agree. I have no idea how you can say that Disney is being hit hard currently, their theme parks seem to be doing extremely well, can you provide any data that says otherwise

 

[AurumPunzel]

I don't think looking into macroeconomics is worth diving into on this one, we just don't agree. I have no idea how you can say that Disney is being hit hard currently, their theme parks seem to be doing extremely well, can you provide any data that says otherwise

The next quarterly report should paint a bigger picture. You might think that the Parks are doing well currently, but that's failing to take into account the plummeting share price, which is usually a sign of impact throughout the company, and not just one division.