Bryan Burmeister
Mouseketeer
- Joined
- Nov 28, 2018
- Messages
- 128
See this link here - Disney's return on invested capital is close to 16%. https://www.gurufocus.com/term/ROIC/DIS/ROIC-/Walt-Disney-Co
This means that, when they look at what projects to invest in, they probably give priority to projects that return at least this average 16% - like a new Star Wars ride or a new Marvel movie. Purchasing points so they can sit on them for one year does not make much sense, unless somehow the points would increase in value by a significant amount. But most of the increase in the value of BLT points is driven by the ROFR purchases - the more they ROFR, the higher the price. If really sounds like a bubble.
Ok, we can agree their ROIC is 16%, that makes sense. That same article you linked says that their WACC (Weighted average COST of capital) is around 5%. I thought you were referring to this number in your comment, so that is why I was surprised. Glad for the clarification
