Disney Parks May Not Open Until January 2021 – If Prepared
Concerns for the Walt Disney Company continue to grow. The theme park segment has the third downgrade of the entertainment giant’s stock this month. According to UBS analyst John Hodulik, he fears that the company is in “The Eye of the Storm.” On Tuesday, April 21, shares are off 3.7% during morning trading. He warns that Disney parks may not open until January 2021.
Concerns For The Walt Disney Company Continue To Grow
All aspects of Disney’s business could suffer from the COVID-19 pandemic. But the most that will suffer is the company’s theme parks. According to Market Watch, he predicts that the company won’t be able to reopen its parks until Jan. 2, 2021. He also anticipates the company’s attractions to feel the pressure even beyond then.
“[T]he economic recession plus the need for social distancing, new health precautions, the lack of travel and crowd aversion are likely to make this business less profitable until there is a widely available vaccine,” Hodulik wrote, while cutting his price target on Disney’s stock to $114 from $162.
The Lack Of Live Sports Content Is Negatively Impacting To The Company To The Point Where Its Advertising Trends “Will Lead The Industry Down”
He’s also concerned about Disney’s media assets. The lack of live sports content is negatively impacting to the company to the point where its advertising trends “will lead the industry down,” according to Hodulik. It’s still unclear whether sports will resume or when it will return. Any changes made to professional sports could also suffer major repercussions across the entire industry, Hodulik warned.
Disney Relaunches Bedtime Hotline For Little Ones In Time For The Pandemic https://t.co/809iLHJzNq
— The Go To Family (@thegotofamily) April 20, 2020
Not only will it affect advertising revenue, but it could also pressure affiliate revenues “given greater cord-cutting and distributors’ reluctance to pay.” Disney’s movie business “could have been worse” for the company since it had a weaker film slate following a successful 2019. He feels that the box office will slowly recover. As for the company’s Disney+ streaming service, he feels that it’s “a bright spot” in a dark time.
It attracted 70 million subscribers by the end of the fiscal year, which ends in September The company announced in April that Disney+ reached 50 million subscribers.