One of the best-performing stocks of the 2010's was Netflix. And, with 2019's big push for new streaming services, the competition is heating up.
The most interesting competitor to emerge this year was The Walt Disney Company (DIS), with its Disney+ streaming service launch.
Taking advantage of its massive library of content spanning nearly a century, the company could have gotten away with pricing its service at a premium. But instead, Disney went with one of the most accessible prices on the market, with a $6.99 monthly fee, well below that of other competitors with fewer offerings.
And the launch has hit the ground running, with millions of sign-ups, as well as a handful of hiccups on the first day of launch. But the company got its tech issues resolved, and it's also got a solid hit with one of its original programs, The Mandolorian, a show that takes place in the Star Wars universe.
While that's a great development, what does it mean for shares? After all, the announcement of the new service early in 2019 sent shares soaring. And the lack of any issues or challenges to the service right away also sent shares roaring even higher to close out the year.
That's a potential sign that shares may have peaked. The billions of dollars in cash flow from monthly subscriptions will help the bottom line. But the media giant also just had a great year at the box office, smashing records. It won't be able to have that kind of lineup anytime in the next few years.
Given that the Disney+ news this year has sent shares to 23 times earnings, it's possible that the company may underperform for the next few years—and investors would be better to wait for a sizeable pullback before looking to invest.
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