Stock Story -
What Happened: Shares of global entertainment and media company Disney (NYSE:DIS) jumped 10.8% in the morning session after the company reported first-quarter results with operating income and operating margin exceeding expectations, leading to a convincing EPS beat. The better margin performance was led by lower content costs, which is something that will be cheered by the markets because of the persistent fear that streaming platforms are simply a 'race to the bottom' where consumers demand and get amazing content but companies have to pay more and more to produce it with enough velocity to satisfy customers. Free cash flow in the quarter also beat convincingly. Lastly, on the positive side, streaming subs beat by a small margin, and guidance for net adds to the Disney+ platform next quarter was solid and certainly better than feared. Zooming out, this was a solid quarter, showing that the company has some wind at its back.
Is now the time to buy Disney? Find out by reading the original article on StockStory.
What is the market telling us: Disney's shares are somewhat volatile and over the last year have had 2 moves greater than 5%. But moves this big are very rare even for Disney and that is indicating to us that this news had a significant impact on the market's perception of the business.
Disney is up 22.7% since the beginning of the year, and at $111.38 per share it is trading close to its 52-week high of $111.78 from February 2023. Investors who bought $1,000 worth of Disney's shares 5 years ago would now be looking at an investment worth $998.39.
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