Fast Money Blog- 2/9/24
This week on Wall Street everyone had its eyes on Disney’s latest earnings release.
The Walt Disney Company (DIS) reported Q1 2024 quarterly top-line revenue of $23.55 billion, relatively flat compared with $23.51 billion in the year-ago quarter.
Disney+ subscribers shrank by 1.3 million from the previous quarter due to price increases, although because to this price increase the company did see a rise in revenue per user.
As a Wealthy Investor here’s what you need to know:
Disney is divided into 3 major categories:
Disney Entertainment, which includes its entire media and streaming portfolio. Q1 revenue for this segment was $9.98 billion, down 7% year-over-year.
Experiences, which encompasses the parks business. This segment saw a 7% increase year-over-year in revenue to $9.13 billion
Sports, which includes ESPN networks and ESPN+. Q4 revenue for this segment was $4.84 billion, a 4% increase year-over-year.
Still, Disney’s direct-to-consumer unit reported a $138 million operating loss in the quarter. Including ESPN+, losses for all its streaming businesses narrowed to $216 million, from $1.05 billion in the prior-year period.
Disney did announce that it will take a $1.5 billion stake in Fortnite studio Epic Games and launch a flagship ESPN streaming service in fall 2025. In this new streaming venture, Disney will partner with Fox Corporation and Warner Bros. Discovery, making all of their sports programming available under a single service.
The company also announced they were raising their cash dividend by 50% to .45 cents a share, beginning in July.
Nevertheless, because of the negative financial impact of their streaming segment I can not recommend Disney as a trade or an investment. If you currently own shares I recommend you be patient and wait for a turnaround over the next 5 years.
As you know when publicly traded companies financially mature, they move into the Wealthy Investor program. This is the case with Uber Technologies, Inc. (UBER)
On Wednesday, February 7th, Uber released their Q4 2023 earnings. The data indicates real maturity and financial stability for this publicly traded company.
Here are their extraordinary highlights for the quarter:
Top line revenue of $9.9 billion, up 15% year-over-year.
A rise of 30% year-over-year in the number of active drivers. The number of trips taken also increased 24%.
A 19% increase year-over-year for Uber Eats, Uber’s meal delivery sector. This is the largest increase in two years. Even better, Uber said that growth is coming from attracting more people who are using the service more often, rather than higher pricing.
As of the end of 2023, membership for its loyalty program, Uber One, which costs $9.99 a month and offers perks such as waiving a delivery fee, had 19 million members in 25 countries. This demonstrates that Uber is also mastering the art of generating recurring revenue.
Therefore, I would have to recommend Uber as a trade with a small portion of your account.
For the Wealthy Investor program, 2024 will be the year of a balanced portfolio. This means we will trade stocks like Amazon.com (AMZN), Uber Technologies, Inc. (UBER) and Alphabet, Inc. (GOOG), which do not pay a dividend, while simultaneously balancing the risk in our retirement portfolios with dividend paying stocks like Visa, Inc. (V), Mastercard Incorporated (MA), The Home Depot, Inc. (HD) and The Coca-Cola Company (KO).
Again, this is the year of balance and discipline!
Tyrone Jackson
The Wealthy Investor