Is Disney the most tempting value stock?

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huskerfan1414
Posts: 133
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Re: Is Disney the most tempting value stock?

Post by huskerfan1414 » Wed May 06, 2020 2:19 pm

The most tempting value stocks right now in my mind are cruises and airlines. I think they'll rebound.

Delta, southwest, carnival.

But I'm not going to go get heavily invested in them.
The more I learn, the dumber I feel.

Robot Monster
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Location: New York

Re: Is Disney the most tempting value stock?

Post by Robot Monster » Wed May 06, 2020 2:25 pm

If Disney is a negatively covid-impacted company, might not one buy it along with a positively covid-impacted company, a company that would actually be hurt once covid goes away? Could you diversify away the covid with something like such?
"I HAVE THE POWER!!!" ~ He-Man

inbox788
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Re: Is Disney the most tempting value stock?

Post by inbox788 » Wed May 06, 2020 2:28 pm

nigel_ht wrote:
Wed May 06, 2020 1:45 pm
Any 10X or 30X stock is likely hugely speculative and has a far higher risk of going to $0.
Is there any way to test this hypothesis, let alone defining entry criteria?

Beyond knowing about their existence, I hardly understand Sharpe and Sortino ratios.
https://www.investopedia.com/ask/answer ... -ratio.asp

What timeframe are we dealing with here? In 30 years, I expect the SP500 will be 10X or 30X (3 to 5 doublings). Other than my opinion, what else can I use to decide DIS can achieve that in a shorter time? Or GE will take longer or go bankrupt in that time? If the company issues corporate bonds, it might be the market bet one company is a better bet than another (and compared to the government bond risk).
The 30-year slice cleared at 103 basis points over the risk-free benchmark to yield 2.987%, from 125 basis points initially....the 30-year Treasury yield TMUBMUSD30Y, 1.417% was near a multiyear low of 1.989%
https://www.marketwatch.com/story/here- ... 2019-09-04

I wonder what these "beauties" are worth and yielding today. I've yet to find an easy site to search for and get recent quotes (even if old) for corporate bonds. Given the current rates, I'm guessing they will be called in 2023.
Disney issued $300 million worth, priced to yield 7.55 percent, in 1993. (They were dubbed "Sleeping Beauty bonds" by the financial press.)
https://www.cbsnews.com/news/100-year-b ... rtainty63/

Wonder what DIS would be getting today? What a difference a year makes!
What slowdown? US companies led by Disney just raised a whopping $27 billion of debt in a single day (DIS, CSX, CAT, COF)
Sep. 4, 2019
Disney alone issued $7 billion of bonds in six different maturity rates Tuesday. Its 30-year bond sold for just 95 basis points above the equivalent Treasury yield, down from an initial offering of 1.15 points higher, according to Bloomberg. The 30-year bond represents Disney's largest offering of the day, raising roughly $2 billion.
https://markets.businessinsider.com/new ... 1028498426

How do I put a measurable and comparable value on a company risk going bankrupt against another, say C vs WFC? Would bank stress tests help?

https://www.investopedia.com/terms/b/ba ... s-test.asp
https://www.barrons.com/articles/wells- ... 1530283307

Bond Ratings and Credit Risk
https://thismatter.com/money/bonds/bond ... t-risk.htm

Hard to make any conclusions from few samples/examples.
https://truthout.org/articles/the-indis ... s-changed/

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unclescrooge
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Re: Is Disney the most tempting value stock?

Post by unclescrooge » Wed May 06, 2020 2:50 pm

quantAndHold wrote:
Tue May 05, 2020 5:04 pm
unclescrooge wrote:
Mon May 04, 2020 10:52 pm
quantAndHold wrote:
Mon May 04, 2020 9:35 pm
So nobody here seems to have run discount cash flows, except for one person who has a Python program and isn’t showing their work. A financial analysis would seem kind of important if I was arguing that Disney is a value play.
The pros have already done this, and if you haven’t, then they know more than you do.
If you run a DCF model in a stock, and the first 2 years income is zero, does it really affect the long term valuation of the stock? 🤔
That’s kind of what I’m getting at. I haven’t done it because I don’t really care. But I’m guessing you have to make some very optimistic assumptions to get this to pencil out as a value stock.
I believe this is what Morningstar does when they provide a fair market value for a stock (I think you might need a subscription to see the actual number).

Currently, it's listed at $130, and trading at a 22% discount (I didn't do that math, so please didn't tell me it's wrong!). Their analysis was updated yesterday.

Apparently it is a value stock!

In a related note, I finally caved and bought an annual subscription to Disney plus.

nigel_ht
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Re: Is Disney the most tempting value stock?

Post by nigel_ht » Wed May 06, 2020 4:14 pm

TigerNest wrote:
Wed May 06, 2020 1:59 pm
Movie theaters, Theme Parks, Sports (ESPN), Cruises, merchandise sales....

It's a well-run company with good IP, but they seem much more exposed to covid-impacted industries than most large companies, and some of those segments may take a while to recover.

It's also only down ~30% YTD, back to 2018 price levels.
Given that they DO have some structural weaknesses with their IP (like Marvel) it probably close to fairly priced at the moment. The last few years was going to be a hard period to repeat.

GT99
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Re: Is Disney the most tempting value stock?

Post by GT99 » Wed May 06, 2020 5:56 pm

I got in on Disney at $86 back in March. I'm considering it a Hold at this point. Right now, I wouldn't consider buying more above $90. I do think there is a lot of long term potential. The parks are hurting right now, but long term, those places are just printing money. I have 2 young daughters and have been to Disney World a bunch in recent years - it never ceases to amaze me how many people can actually afford to stay in their resorts and visit multiple parks on a trip. It will take at least a year to get back to pre-CV ticket sales, maybe 2 or even 3, but long term, they'll be fine.

Disney+ isn't available in much of the world yet - nowhere in South America or Asia. Subscriber base will increase dramatically once they move into those markets.

The cruise line is interesting. Unlike the other major cruise lines, Disney isn't at risk of going under. There is a big opportunity here for them to increase cruise market share going forward - possibly even buy out a small competitor and convert the ships to Disney. But I do think cruise demand will be down for several years, so it would be a risky play.

randomguy
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Re: Is Disney the most tempting value stock?

Post by randomguy » Wed May 06, 2020 8:12 pm

huskerfan1414 wrote:
Wed May 06, 2020 2:19 pm
The most tempting value stocks right now in my mind are cruises and airlines. I think they'll rebound.

Delta, southwest, carnival.

But I'm not going to go get heavily invested in them.
The question is do they rebound before or after they go through bankruptcy. It is probably something like 2/3rds of the time you will triple your money and 1/3rd of the time you go broke.

nigel_ht
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Re: Is Disney the most tempting value stock?

Post by nigel_ht » Wed May 06, 2020 9:30 pm

randomguy wrote:
Wed May 06, 2020 8:12 pm
huskerfan1414 wrote:
Wed May 06, 2020 2:19 pm
The most tempting value stocks right now in my mind are cruises and airlines. I think they'll rebound.

Delta, southwest, carnival.

But I'm not going to go get heavily invested in them.
The question is do they rebound before or after they go through bankruptcy. It is probably something like 2/3rds of the time you will triple your money and 1/3rd of the time you go broke.
If there was a 33% chance or DAL, CCL or LUV going bankrupt their stocks would be a lot lower.

randomguy
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Re: Is Disney the most tempting value stock?

Post by randomguy » Wed May 06, 2020 10:02 pm

nigel_ht wrote:
Wed May 06, 2020 9:30 pm
randomguy wrote:
Wed May 06, 2020 8:12 pm
huskerfan1414 wrote:
Wed May 06, 2020 2:19 pm
The most tempting value stocks right now in my mind are cruises and airlines. I think they'll rebound.

Delta, southwest, carnival.

But I'm not going to go get heavily invested in them.
The question is do they rebound before or after they go through bankruptcy. It is probably something like 2/3rds of the time you will triple your money and 1/3rd of the time you go broke.
If there was a 33% chance or DAL, CCL or LUV going bankrupt their stocks would be a lot lower.
Feel free to sub in your own numbers. I have no doubt that most of these business will continue on. I have a lot less faith that the shareholders will get to enjoy the rebound.

effigy98
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Re: Is Disney the most tempting value stock?

Post by effigy98 » Wed May 06, 2020 10:27 pm

Every stock is now the FED until the election is over. I think all stocks are good stocks with taxpayer money buying them indirectly. You are buying DIS even if you don't want it.

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StormShadow
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Re: Is Disney the most tempting value stock?

Post by StormShadow » Wed May 06, 2020 10:30 pm

Robot Monster wrote:
Wed May 06, 2020 2:25 pm
If Disney is a negatively covid-impacted company, might not one buy it along with a positively covid-impacted company, a company that would actually be hurt once covid goes away? Could you diversify away the covid with something like such?
Yes. It’s called hedging.

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abuss368
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Re: Is Disney the most tempting value stock?

Post by abuss368 » Wed May 06, 2020 10:45 pm

whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Thu May 07, 2020 6:11 am

abuss368 wrote:
Wed May 06, 2020 10:45 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
Absolutely, and a great reminder. Disney is in my funny money account.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

nigel_ht
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Joined: Tue Jan 01, 2019 10:14 am

Re: Is Disney the most tempting value stock?

Post by nigel_ht » Thu May 07, 2020 7:35 am

abuss368 wrote:
Wed May 06, 2020 10:45 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
https://youtu.be/6fqT1VJScuc

5% fun money is fine...and that’s all we’ve been talking about. Folks who quote Bogle Chapter and Verse should at least know the entire Bogle Bible.

nigel_ht
Posts: 890
Joined: Tue Jan 01, 2019 10:14 am

Re: Is Disney the most tempting value stock?

Post by nigel_ht » Thu May 07, 2020 7:47 am

randomguy wrote:
Wed May 06, 2020 10:02 pm
nigel_ht wrote:
Wed May 06, 2020 9:30 pm
randomguy wrote:
Wed May 06, 2020 8:12 pm
huskerfan1414 wrote:
Wed May 06, 2020 2:19 pm
The most tempting value stocks right now in my mind are cruises and airlines. I think they'll rebound.

Delta, southwest, carnival.

But I'm not going to go get heavily invested in them.
The question is do they rebound before or after they go through bankruptcy. It is probably something like 2/3rds of the time you will triple your money and 1/3rd of the time you go broke.
If there was a 33% chance or DAL, CCL or LUV going bankrupt their stocks would be a lot lower.
Feel free to sub in your own numbers. I have no doubt that most of these business will continue on. I have a lot less faith that the shareholders will get to enjoy the rebound.
The numbers are the important parts when someone claims individual stocks must return 1000% to represent good risk/reward ratio. That individual stock plays should generally attempt to return more than the index is something of a given. No argument there.

The requirement for 1000% returns for any stock play is silly since the risk of a complete loss in a 3 year period is low for the majority of stocks.

You only want that expected rate of return if it’s a long shot swing for the fences play where the company really does have a high risk of going under. Like say TSLA at the beginning...TSLA could wildly succeed or end up as the modern Delorean Motor Company. Today, with the number of TSLA cars on the streets you missed most of the rapid gains but it’s also less likely to go under. Still more possible for TSLA to go poof than DIS but also more likely for much larger gains than even a heavily discounted DIS.

IndexInvestingMatt
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Re: Is Disney the most tempting value stock?

Post by IndexInvestingMatt » Thu May 07, 2020 9:25 am

I looked hard at Disney right before they rolled out Disney Plus. I bought 1 share just to say I owned a piece of The Most Magical Place on Earth but as I looked deeper I felt Disney was lined up for a major and extended pullback. (This was before Covid19 forced them to basically close for a year.) With the newest park in Shanghai now bringing guests at full capacity and no real major IDEAL major market to place another park, that revenue may have reached its peak potential at least in the short term, so no new growth for Disney’s largest and most consistent revenue generator. Star Wars and this storyline of The Avengers has finished so Disney’s recent box office money cows have dried up. Pixar and Disney Animation haven’t produced many hits for years now. Disney Plus will take 2-3 years before it starts to show profits per subscription. Bob Iger did a lot for Disney and it looks like he saw Disney was about to run into a wall with his abrupt exit 2 years sooner than he said would be ideal in his recent autobiography. Now that the parks may not reopen until 2021 I would not be surprised to see Disney fall a lot farther than $100. But going forward I’m not convinced Disney can maintain itself as a growth stock. But with their history of innovation who knows what rabbits they could pull out of their hats.

hoops777
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Re: Is Disney the most tempting value stock?

Post by hoops777 » Thu May 07, 2020 10:55 am

KlangFool wrote:
Wed May 06, 2020 11:48 am
hoops777 wrote:
Wed May 06, 2020 11:26 am

My point is that you learn from the best not that you try to become them. I can study teaching videos from a great athlete to improve my skills. I am not trying to become him. But as usual you twist everything to your belief. My point is many,actually the majority of the greatest investors in the world bought individual stocks. My point is they are/were not irrational gamblers. My point is I have zero problem or any negative thing to say about anyone who simply believes one should not buy individual stocks.I actually agree buying index funds is the best option for most. My problem stems from your labeling of people and your nonsensical math that you use as a personal firewall to make sure you never buy an individual stock. It is great for you because that is what you need.Please do not expect others to have your belief of 10x to 30x and label them as irrational gamblers if they disagree with your extreme view.
hoops777,

<<My point is many,actually the majority of the greatest investors in the world bought individual stocks. My point is they are/were not irrational gamblers. >>

But, you and I are not one of them. So, how does that validate anything?

<<My problem stems from your labeling of people and your nonsensical math that you use as a personal firewall to make sure you never buy an individual stock.>>

That statement is actually not true. I am buying a stock now because I believe that it can return 10X to 30X.

<<Please do not expect others to have your belief of 10x to 30x and label them as irrational gamblers if they disagree with your extreme view.>>

Show me the math and calculation on how does it makes any sense?

It is very simple.

A) The stock market can drop 50% and the stock market return about X% per year.

B) Individual stock can drop 100%. So, the risk is significantly higher than the stock market. So, the return needs to be a lot higher.

C) Because of the higher risk aka losing 10%, the person should not invest more than 5% of its portfolio into individual stocks.

D) That translates into about 1% of the portfolio into one stock.

E) In order for that 1% to generate return significantly enough to matter, it needs to return 10X to 30X.

KlangFool
As I said tunnel vision and nonsensical.Hang in there and good luck with finding those 30x stocks.Where you are really off base is the return you say is required to make it worthwhile which is ridiculous to anyone but obviously you.
K.I.S.S........so easy to say so difficult to do.

nigel_ht
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Re: Is Disney the most tempting value stock?

Post by nigel_ht » Thu May 07, 2020 11:02 am

IndexInvestingMatt wrote:
Thu May 07, 2020 9:25 am
I looked hard at Disney right before they rolled out Disney Plus. I bought 1 share just to say I owned a piece of The Most Magical Place on Earth but as I looked deeper I felt Disney was lined up for a major and extended pullback. (This was before Covid19 forced them to basically close for a year.) With the newest park in Shanghai now bringing guests at full capacity and no real major IDEAL major market to place another park, that revenue may have reached its peak potential at least in the short term, so no new growth for Disney’s largest and most consistent revenue generator. Star Wars and this storyline of The Avengers has finished so Disney’s recent box office money cows have dried up. Pixar and Disney Animation haven’t produced many hits for years now. Disney Plus will take 2-3 years before it starts to show profits per subscription. Bob Iger did a lot for Disney and it looks like he saw Disney was about to run into a wall with his abrupt exit 2 years sooner than he said would be ideal in his recent autobiography. Now that the parks may not reopen until 2021 I would not be surprised to see Disney fall a lot farther than $100. But going forward I’m not convinced Disney can maintain itself as a growth stock. But with their history of innovation who knows what rabbits they could pull out of their hats.
It will be very hard for the Mouse to lose to Netflix in the coming years in terms of IP depth. One of the two market caps is wrong...or at least more wrong than today.

I enjoy the Witcher but I liked Mandalorian more.

And Disney effectively owns Hulu even if total ownership won't happen till 2024. Any GoT style content can go to Hulu.

If NFLX is a growth stock then probably Disney is.

Onward only did $100M+ but got chopped off by corona virus a few weeks into its run.
Frozen II did $1.5B. Wreckit Ralph 2 $530M Moana $690M. Zootopia $1B
Rogue One did $1B so there's life in that franchise even if Solo was a box-office bomb at $390M. Especially with the success of the Mandalorian.

The upcoming Mulan and Raya The Last Dragon which should play well in the Chinese market. If it does they should do very well.

I think $100 is a fair value for DIS today. Not exceptional but not bad.

KlangFool
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Re: Is Disney the most tempting value stock?

Post by KlangFool » Thu May 07, 2020 11:31 am

Folks,

The stock market can drop by 50%. DIS stock can drop by at least 75%. The 30X stock can drop by 100%

A) Put 50K into DIS stock at $50.

i) If it works out, it goes up to 3X to $150 and you make 100K

ii) If it failed, you lose 75% of 50K = 37.5K


B) Put 45K into your 60/40 portfolio and 5K into your 30X stock.

i) If it works out, you make 150K - 5K = 145K.

ii) If it failed, the 5K goes to zero. The 60/40 portfolio loss 30% = 13.5K. Total loss = 13.5K + 5K = 18.5K


The best case of (A) is about 50K less than (B). The worst case of (A) is 19K worst than (B). Why (A) is a better bet than (B)?

KlangFool

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abuss368
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Re: Is Disney the most tempting value stock?

Post by abuss368 » Thu May 07, 2020 11:38 am

nigel_ht wrote:
Thu May 07, 2020 7:35 am
abuss368 wrote:
Wed May 06, 2020 10:45 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
https://youtu.be/6fqT1VJScuc

5% fun money is fine...and that’s all we’ve been talking about. Folks who quote Bogle Chapter and Verse should at least know the entire Bogle Bible.
Jack Bogle has said that no more than 5% of a portfolio should be allocated to a "Funny Money" account if so desired. He then also mentioned in "The Little Book of Common Sense Investing" (please see pages 200 - 205 of the 1st edition) to compare the results to the indexed total market portfolio.
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

hoops777
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Joined: Sun Apr 10, 2011 12:23 pm

Re: Is Disney the most tempting value stock?

Post by hoops777 » Thu May 07, 2020 11:47 am

abuss368 wrote:
Thu May 07, 2020 11:38 am
nigel_ht wrote:
Thu May 07, 2020 7:35 am
abuss368 wrote:
Wed May 06, 2020 10:45 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
https://youtu.be/6fqT1VJScuc

5% fun money is fine...and that’s all we’ve been talking about. Folks who quote Bogle Chapter and Verse should at least know the entire Bogle Bible.
Jack Bogle has said that no more than 5% of a portfolio should be allocated to a "Funny Money" account if so desired. He then also mentioned in "The Little Book of Common Sense Investing" (please see pages 200 - 205 of the 1st edition) to compare the results to the indexed total market portfolio.
Did the patron saint say that 5 pct funny money has to return the same total amount as the other 95% ? I believe that answer is NO.
K.I.S.S........so easy to say so difficult to do.

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whereskyle
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Re: Is Disney the most tempting value stock?

Post by whereskyle » Thu May 07, 2020 11:55 am

nigel_ht wrote:
Thu May 07, 2020 11:02 am
IndexInvestingMatt wrote:
Thu May 07, 2020 9:25 am
I looked hard at Disney right before they rolled out Disney Plus. I bought 1 share just to say I owned a piece of The Most Magical Place on Earth but as I looked deeper I felt Disney was lined up for a major and extended pullback. (This was before Covid19 forced them to basically close for a year.) With the newest park in Shanghai now bringing guests at full capacity and no real major IDEAL major market to place another park, that revenue may have reached its peak potential at least in the short term, so no new growth for Disney’s largest and most consistent revenue generator. Star Wars and this storyline of The Avengers has finished so Disney’s recent box office money cows have dried up. Pixar and Disney Animation haven’t produced many hits for years now. Disney Plus will take 2-3 years before it starts to show profits per subscription. Bob Iger did a lot for Disney and it looks like he saw Disney was about to run into a wall with his abrupt exit 2 years sooner than he said would be ideal in his recent autobiography. Now that the parks may not reopen until 2021 I would not be surprised to see Disney fall a lot farther than $100. But going forward I’m not convinced Disney can maintain itself as a growth stock. But with their history of innovation who knows what rabbits they could pull out of their hats.
It will be very hard for the Mouse to lose to Netflix in the coming years in terms of IP depth. One of the two market caps is wrong...or at least more wrong than today.

I enjoy the Witcher but I liked Mandalorian more.

And Disney effectively owns Hulu even if total ownership won't happen till 2024. Any GoT style content can go to Hulu.

If NFLX is a growth stock then probably Disney is.

Onward only did $100M+ but got chopped off by corona virus a few weeks into its run.
Frozen II did $1.5B. Wreckit Ralph 2 $530M Moana $690M. Zootopia $1B
Rogue One did $1B so there's life in that franchise even if Solo was a box-office bomb at $390M. Especially with the success of the Mandalorian.

The upcoming Mulan and Raya The Last Dragon which should play well in the Chinese market. If it does they should do very well.

I think $100 is a fair value for DIS today. Not exceptional but not bad.
Entirely agree. Why would anyone think Netflix's original content is going to outmatch Disney's original content? People went ballistic for the Mandalorian. In my view, Disney+ simply could not have had a more successful rollout. IF there is any mispricing, it is because people are focusing on the present and not the future. That said, $100 is probably fair value and Disney will almost certainly give market returns over the long haul. The real issue I'm learning about in playing with funny money is that there is just no reason to take greater risk with individual stocks when their prospects match those of the market as a whole. This is why Jack told me I could play with funny money! To learn why indexing works.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

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abuss368
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Re: Is Disney the most tempting value stock?

Post by abuss368 » Thu May 07, 2020 1:04 pm

hoops777 wrote:
Thu May 07, 2020 11:47 am
abuss368 wrote:
Thu May 07, 2020 11:38 am
nigel_ht wrote:
Thu May 07, 2020 7:35 am
abuss368 wrote:
Wed May 06, 2020 10:45 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
https://youtu.be/6fqT1VJScuc

5% fun money is fine...and that’s all we’ve been talking about. Folks who quote Bogle Chapter and Verse should at least know the entire Bogle Bible.
Jack Bogle has said that no more than 5% of a portfolio should be allocated to a "Funny Money" account if so desired. He then also mentioned in "The Little Book of Common Sense Investing" (please see pages 200 - 205 of the 1st edition) to compare the results to the indexed total market portfolio.
Did the patron saint say that 5 pct funny money has to return the same total amount as the other 95% ? I believe that answer is NO.
Please consider referring to the book for additional information.
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

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tvubpwcisla
Posts: 514
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Re: Is Disney the most tempting value stock?

Post by tvubpwcisla » Thu May 07, 2020 1:05 pm

whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Disney is a great stock to own and hold for the long run. I'm a fan!

Can't wait to see Mulan!
Stay invested my friends.

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Thu May 07, 2020 1:10 pm

tvubpwcisla wrote:
Thu May 07, 2020 1:05 pm
whereskyle wrote:
Mon May 04, 2020 11:28 am
Hello all,

I bought some Disney for my funny money account in early April while it was under $100 per share. I told myself I would consider buying more of it if it crossed under $100 again, and it looks like that might happen this week.

I am obviously tempted, and I wanted to reach out to you all, especially those of you who consider yourselves value investors. Am I just a crazy millenial raised on Disney to such an extent that I find its long-term success almost unquestionable? Does an IP horde like theirs lead to unique long-term security despite near-term drudgery (if not catastrophe for their parks and in-person events business)?

Does anyone else consider Disney a no-brainer value buy?

Thanks, all!
Disney is a great stock to own and hold for the long run. I'm a fan!

Can't wait to see Mulan!
It looks spectacular.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

rockstar
Posts: 385
Joined: Mon Feb 03, 2020 6:51 pm

Re: Is Disney the most tempting value stock?

Post by rockstar » Thu May 07, 2020 1:13 pm

I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.

quantAndHold
Posts: 4699
Joined: Thu Sep 17, 2015 10:39 pm

Re: Is Disney the most tempting value stock?

Post by quantAndHold » Thu May 07, 2020 1:23 pm

unclescrooge wrote:
Wed May 06, 2020 2:50 pm
quantAndHold wrote:
Tue May 05, 2020 5:04 pm
unclescrooge wrote:
Mon May 04, 2020 10:52 pm
quantAndHold wrote:
Mon May 04, 2020 9:35 pm
So nobody here seems to have run discount cash flows, except for one person who has a Python program and isn’t showing their work. A financial analysis would seem kind of important if I was arguing that Disney is a value play.
The pros have already done this, and if you haven’t, then they know more than you do.
If you run a DCF model in a stock, and the first 2 years income is zero, does it really affect the long term valuation of the stock? 🤔
That’s kind of what I’m getting at. I haven’t done it because I don’t really care. But I’m guessing you have to make some very optimistic assumptions to get this to pencil out as a value stock.
I believe this is what Morningstar does when they provide a fair market value for a stock (I think you might need a subscription to see the actual number).

Currently, it's listed at $130, and trading at a 22% discount (I didn't do that math, so please didn't tell me it's wrong!). Their analysis was updated yesterday.

Apparently it is a value stock!

In a related note, I finally caved and bought an annual subscription to Disney plus.
Disney is a large, heavily followed company. If the market thought Disney was actually worth $130, it would be selling for $130. What assumptions is Morningstar making to get to that number? If I were interested in this as a value play, I would not trust a number that’s available for everyone to see, from a company whose financial incentives are different than mine. What do I know that the market doesn’t know? The market already knows Morningstar’s number.
Yes, I’m really that pedantic.

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unclescrooge
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Re: Is Disney the most tempting value stock?

Post by unclescrooge » Thu May 07, 2020 2:27 pm

quantAndHold wrote:
Thu May 07, 2020 1:23 pm
unclescrooge wrote:
Wed May 06, 2020 2:50 pm
quantAndHold wrote:
Tue May 05, 2020 5:04 pm
unclescrooge wrote:
Mon May 04, 2020 10:52 pm
quantAndHold wrote:
Mon May 04, 2020 9:35 pm
So nobody here seems to have run discount cash flows, except for one person who has a Python program and isn’t showing their work. A financial analysis would seem kind of important if I was arguing that Disney is a value play.
The pros have already done this, and if you haven’t, then they know more than you do.
If you run a DCF model in a stock, and the first 2 years income is zero, does it really affect the long term valuation of the stock? 🤔
That’s kind of what I’m getting at. I haven’t done it because I don’t really care. But I’m guessing you have to make some very optimistic assumptions to get this to pencil out as a value stock.
I believe this is what Morningstar does when they provide a fair market value for a stock (I think you might need a subscription to see the actual number).

Currently, it's listed at $130, and trading at a 22% discount (I didn't do that math, so please didn't tell me it's wrong!). Their analysis was updated yesterday.

Apparently it is a value stock!

In a related note, I finally caved and bought an annual subscription to Disney plus.
Disney is a large, heavily followed company. If the market thought Disney was actually worth $130, it would be selling for $130. What assumptions is Morningstar making to get to that number? If I were interested in this as a value play, I would not trust a number that’s available for everyone to see, from a company whose financial incentives are different than mine. What do I know that the market doesn’t know? The market already knows Morningstar’s number.
Just because the market knows something doesn't mean it has to believe it.

When the stock market drops 9% one day and then rises 9% the next, it means bulls and bears are in violent disagreement.
Last edited by unclescrooge on Thu May 07, 2020 3:46 pm, edited 1 time in total.

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whereskyle
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Re: Is Disney the most tempting value stock?

Post by whereskyle » Thu May 07, 2020 2:58 pm

rockstar wrote:
Thu May 07, 2020 1:13 pm
I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.
Bought more VGT+VUG yesterday because I'm primarily a futurist bull in my funny money account. The companies driving QQQ, VGT, and VUG, are patently not value stocks though. My position in Disney is my first attempt at picking a "value" stock, and I wanted input from value investors. They quickly showed me I have no idea what I'm talking about when it comes to identifying a value stock. As a general matter, it's easy for me to agree that tech/growth is the place to be in the near term. Disney is more interesting for me though because I'm trying something a little different: identifying a company on the ropes now with intrinsic value and long-term upside. Disney is an easy pick, but I think I agree that I'm no genius in buying it in the $90 range because that's probably exactly how much it's worth.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

nigel_ht
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Re: Is Disney the most tempting value stock?

Post by nigel_ht » Thu May 07, 2020 3:06 pm

KlangFool wrote:
Thu May 07, 2020 11:31 am
Folks,

The stock market can drop by 50%. DIS stock can drop by at least 75%. The 30X stock can drop by 100%

A) Put 50K into DIS stock at $50.

i) If it works out, it goes up to 3X to $150 and you make 100K

ii) If it failed, you lose 75% of 50K = 37.5K


B) Put 45K into your 60/40 portfolio and 5K into your 30X stock.

i) If it works out, you make 150K - 5K = 145K.

ii) If it failed, the 5K goes to zero. The 60/40 portfolio loss 30% = 13.5K. Total loss = 13.5K + 5K = 18.5K


The best case of (A) is about 50K less than (B). The worst case of (A) is 19K worst than (B). Why (A) is a better bet than (B)?

KlangFool
The probability that DIS will drop more than the 30% that the market will drop after already dropping 70% is remote.

Also because the probability that your unnamed magical 30X stock drops to $0 is higher than DIS going to $150 from $50.

The probability that your unnamed magical stock actually gains 30X is also low.

None of your math accounts for probability of occurrence. You assume incorrectly they are all the same.

nigel_ht
Posts: 890
Joined: Tue Jan 01, 2019 10:14 am

Re: Is Disney the most tempting value stock?

Post by nigel_ht » Thu May 07, 2020 3:13 pm

abuss368 wrote:
Thu May 07, 2020 11:38 am
Jack Bogle has said that no more than 5% of a portfolio should be allocated to a "Funny Money" account if so desired. He then also mentioned in "The Little Book of Common Sense Investing" (please see pages 200 - 205 of the 1st edition) to compare the results to the indexed total market portfolio.
I own a small set of stocks not because I believe they will outperform the market over the long term but because I wanted some. APPL and DIS are in this category for me. I have some nominal amount so I actually have shares as opposed to part of an index.

There are parts of my funny money allocation that I do expect to exceed market performance but ultimately I'm conservative so these aren't very speculative plays.

rockstar
Posts: 385
Joined: Mon Feb 03, 2020 6:51 pm

Re: Is Disney the most tempting value stock?

Post by rockstar » Thu May 07, 2020 3:18 pm

whereskyle wrote:
Thu May 07, 2020 2:58 pm
rockstar wrote:
Thu May 07, 2020 1:13 pm
I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.
Bought more VGT+VUG yesterday because I'm primarily a futurist bull in my funny money account. The companies driving QQQ, VGT, and VUG, are patently not value stocks though. My position in Disney is my first attempt at picking a "value" stock, and I wanted input from value investors. They quickly showed me I have no idea what I'm talking about when it comes to identifying a value stock. As a general matter, it's easy for me to agree that tech/growth is the place to be in the near term. Disney is more interesting for me though because I'm trying something a little different: identifying a company on the ropes now with intrinsic value and long-term upside. Disney is an easy pick, but I think I agree that I'm no genius in buying it in the $90 range because that's probably exactly how much it's worth.
How do you define value?

I’ve owned Disney in the past. I struggle to own it now, especially with no dividend.

hoops777
Posts: 3070
Joined: Sun Apr 10, 2011 12:23 pm

Re: Is Disney the most tempting value stock?

Post by hoops777 » Thu May 07, 2020 3:47 pm

abuss368 wrote:
Thu May 07, 2020 1:04 pm
hoops777 wrote:
Thu May 07, 2020 11:47 am
abuss368 wrote:
Thu May 07, 2020 11:38 am
nigel_ht wrote:
Thu May 07, 2020 7:35 am
abuss368 wrote:
Wed May 06, 2020 10:45 pm


Jack Bogle has said that investors should not own individual stocks as the risk is too high. Instead of searching for the needle in the haystack by the haystack. Total Stock Index Fund does just that.
https://youtu.be/6fqT1VJScuc

5% fun money is fine...and that’s all we’ve been talking about. Folks who quote Bogle Chapter and Verse should at least know the entire Bogle Bible.
Jack Bogle has said that no more than 5% of a portfolio should be allocated to a "Funny Money" account if so desired. He then also mentioned in "The Little Book of Common Sense Investing" (please see pages 200 - 205 of the 1st edition) to compare the results to the indexed total market portfolio.
Did the patron saint say that 5 pct funny money has to return the same total amount as the other 95% ? I believe that answer is NO.
Please consider referring to the book for additional information.
Thank you but the answer is obvious, so no need.
K.I.S.S........so easy to say so difficult to do.

inbox788
Posts: 7109
Joined: Thu Mar 15, 2012 5:24 pm

Re: Is Disney the most tempting value stock?

Post by inbox788 » Thu May 07, 2020 5:47 pm

nigel_ht wrote:
Thu May 07, 2020 3:13 pm
I own a small set of stocks not because I believe they will outperform the market over the long term but because I wanted some. APPL and DIS are in this category for me. I have some nominal amount so I actually have shares as opposed to part of an index.

There are parts of my funny money allocation that I do expect to exceed market performance but ultimately I'm conservative so these aren't very speculative plays.
I used to hold a few individual stocks, but if they're in the index, it's unlikely to beat the index (mean vs median business and smaller cap have higher skyrocketing potential). Still I doubt that skyrocket is DIS nor would I be able to pick it out now vs. seeing it after the fact.

MSFT, AAPL, AMZN, GOOG, and FB already make up 20% of the SP500. I have a hard time imagining that they will increase that proportion, not that they couldn't, but there's some limit or resistance.

If you have a nominal amount, it's unlikely to make much of a difference, and that's why I've gotten away from that.

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Thu May 07, 2020 5:50 pm

rockstar wrote:
Thu May 07, 2020 3:18 pm
whereskyle wrote:
Thu May 07, 2020 2:58 pm
rockstar wrote:
Thu May 07, 2020 1:13 pm
I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.
Bought more VGT+VUG yesterday because I'm primarily a futurist bull in my funny money account. The companies driving QQQ, VGT, and VUG, are patently not value stocks though. My position in Disney is my first attempt at picking a "value" stock, and I wanted input from value investors. They quickly showed me I have no idea what I'm talking about when it comes to identifying a value stock. As a general matter, it's easy for me to agree that tech/growth is the place to be in the near term. Disney is more interesting for me though because I'm trying something a little different: identifying a company on the ropes now with intrinsic value and long-term upside. Disney is an easy pick, but I think I agree that I'm no genius in buying it in the $90 range because that's probably exactly how much it's worth.
How do you define value?

I’ve owned Disney in the past. I struggle to own it now, especially with no dividend.
I define value very loosely. Basically, it's just my sense that the stock is at a bargain price. I guess in my view pretty much every stock was a value stock in the third and fourth week of March. I started the thread to get a sense from actual value investors whether Disney could be considered a strong value buy. I tend to agree now with most who have chimed in that Disney is trading at a reasonable price, not some huge discount. I still think I bought it at a good price and it'll be a good long-term investment, but I appreciate those who have encouraged me to dig a bit deeper to determine value. If Disney works out great for me, I'll only be tempted to do what I did here: follow pretty commonplace advice that Disney under $100 is a good buying opportunity. I accept that there's more to identifying value than that and I'm glad the only money at stake here is of the funny variety.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

Topic Author
whereskyle
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Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Fri May 08, 2020 8:46 am

"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

nigel_ht
Posts: 890
Joined: Tue Jan 01, 2019 10:14 am

Re: Is Disney the most tempting value stock?

Post by nigel_ht » Fri May 08, 2020 8:58 am

whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
Lol...now I really wish it had gotten oversold to $50.

I own enough in my funsies account to say I own some. Like $10K or something.

There is pent up demand for cruising too...but I still think August will be too soon.

randomguy
Posts: 9035
Joined: Wed Sep 17, 2014 9:00 am

Re: Is Disney the most tempting value stock?

Post by randomguy » Fri May 08, 2020 9:00 am

whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
6 months ago, having 24k visitors (park is designed for 80k) would have been considered an unmitigated disaster. I got to admit I am thinking about making a trip if the US parks end up with such limits. Disney world with 1/3rd the people might be fun....

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Fri May 08, 2020 9:16 am

randomguy wrote:
Fri May 08, 2020 9:00 am
whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
6 months ago, having 24k visitors (park is designed for 80k) would have been considered an unmitigated disaster. I got to admit I am thinking about making a trip if the US parks end up with such limits. Disney world with 1/3rd the people might be fun....
Might be fun!?

It would be a dream!

Good point though that sell-outs in lower capacity parks are not quite as big a profit signal as they seem at first glance.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

statefan03
Posts: 39
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Location: NC

Re: Is Disney the most tempting value stock?

Post by statefan03 » Fri May 08, 2020 9:18 am

whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
Maybe. It's purely speculative. Who knows if this thing comes back twice as bad as before.

nigel_ht
Posts: 890
Joined: Tue Jan 01, 2019 10:14 am

Re: Is Disney the most tempting value stock?

Post by nigel_ht » Fri May 08, 2020 10:24 am

randomguy wrote:
Fri May 08, 2020 9:00 am
whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
6 months ago, having 24k visitors (park is designed for 80k) would have been considered an unmitigated disaster. I got to admit I am thinking about making a trip if the US parks end up with such limits. Disney world with 1/3rd the people might be fun....
Hmmm...that would be fun...and half the kids summer activities for cancelled...

rockstar
Posts: 385
Joined: Mon Feb 03, 2020 6:51 pm

Re: Is Disney the most tempting value stock?

Post by rockstar » Fri May 08, 2020 10:37 am

whereskyle wrote:
Thu May 07, 2020 5:50 pm
rockstar wrote:
Thu May 07, 2020 3:18 pm
whereskyle wrote:
Thu May 07, 2020 2:58 pm
rockstar wrote:
Thu May 07, 2020 1:13 pm
I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.
Bought more VGT+VUG yesterday because I'm primarily a futurist bull in my funny money account. The companies driving QQQ, VGT, and VUG, are patently not value stocks though. My position in Disney is my first attempt at picking a "value" stock, and I wanted input from value investors. They quickly showed me I have no idea what I'm talking about when it comes to identifying a value stock. As a general matter, it's easy for me to agree that tech/growth is the place to be in the near term. Disney is more interesting for me though because I'm trying something a little different: identifying a company on the ropes now with intrinsic value and long-term upside. Disney is an easy pick, but I think I agree that I'm no genius in buying it in the $90 range because that's probably exactly how much it's worth.
How do you define value?

I’ve owned Disney in the past. I struggle to own it now, especially with no dividend.
I define value very loosely. Basically, it's just my sense that the stock is at a bargain price. I guess in my view pretty much every stock was a value stock in the third and fourth week of March. I started the thread to get a sense from actual value investors whether Disney could be considered a strong value buy. I tend to agree now with most who have chimed in that Disney is trading at a reasonable price, not some huge discount. I still think I bought it at a good price and it'll be a good long-term investment, but I appreciate those who have encouraged me to dig a bit deeper to determine value. If Disney works out great for me, I'll only be tempted to do what I did here: follow pretty commonplace advice that Disney under $100 is a good buying opportunity. I accept that there's more to identifying value than that and I'm glad the only money at stake here is of the funny variety.
I have no idea what Disney is worth, and I have no idea when the parks will reopen and when theatres will reopen to show their films. The stock doesn’t pay a dividend right now, so I won’t be paid to wait. If I was going to buy it, I’d want to calculate for myself what I think the stock is worth given some expected growth rate, assuming I’m good with its balance sheet.

When I think of value, I look to Benjamin G. I really like the Intelligent Investor. Check it out.

Like most people here, I invest mainly in index funds. Right now, I have two stocks: AMZN and BX. That’s it. And I bought BX when it was still a publicly traded partnership.

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Fri May 08, 2020 6:04 pm

rockstar wrote:
Fri May 08, 2020 10:37 am
whereskyle wrote:
Thu May 07, 2020 5:50 pm
rockstar wrote:
Thu May 07, 2020 3:18 pm
whereskyle wrote:
Thu May 07, 2020 2:58 pm
rockstar wrote:
Thu May 07, 2020 1:13 pm
I’d rather buy more QQQ and tilt more towards tech than buy this stock right now.

It does look cheap at these levels. But I have no idea how long it’s going to take to recover. Over a 5 year period, I still think I’m better off in QQQ than DIS.
Bought more VGT+VUG yesterday because I'm primarily a futurist bull in my funny money account. The companies driving QQQ, VGT, and VUG, are patently not value stocks though. My position in Disney is my first attempt at picking a "value" stock, and I wanted input from value investors. They quickly showed me I have no idea what I'm talking about when it comes to identifying a value stock. As a general matter, it's easy for me to agree that tech/growth is the place to be in the near term. Disney is more interesting for me though because I'm trying something a little different: identifying a company on the ropes now with intrinsic value and long-term upside. Disney is an easy pick, but I think I agree that I'm no genius in buying it in the $90 range because that's probably exactly how much it's worth.
How do you define value?

I’ve owned Disney in the past. I struggle to own it now, especially with no dividend.
I define value very loosely. Basically, it's just my sense that the stock is at a bargain price. I guess in my view pretty much every stock was a value stock in the third and fourth week of March. I started the thread to get a sense from actual value investors whether Disney could be considered a strong value buy. I tend to agree now with most who have chimed in that Disney is trading at a reasonable price, not some huge discount. I still think I bought it at a good price and it'll be a good long-term investment, but I appreciate those who have encouraged me to dig a bit deeper to determine value. If Disney works out great for me, I'll only be tempted to do what I did here: follow pretty commonplace advice that Disney under $100 is a good buying opportunity. I accept that there's more to identifying value than that and I'm glad the only money at stake here is of the funny variety.
I have no idea what Disney is worth, and I have no idea when the parks will reopen and when theatres will reopen to show their films. The stock doesn’t pay a dividend right now, so I won’t be paid to wait. If I was going to buy it, I’d want to calculate for myself what I think the stock is worth given some expected growth rate, assuming I’m good with its balance sheet.

When I think of value, I look to Benjamin G. I really like the Intelligent Investor. Check it out.

Like most people here, I invest mainly in index funds. Right now, I have two stocks: AMZN and BX. That’s it. And I bought BX when it was still a publicly traded partnership.
Thanks for the rec. All my Graham reading has been secondhand (see Bogle and Buffett references), but if it holds up despite its age, I'll check it out!
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

travelspot
Posts: 59
Joined: Sun Dec 16, 2018 11:40 pm

Re: Is Disney the most tempting value stock?

Post by travelspot » Fri May 08, 2020 6:36 pm

I’ve bought and sold Disney multiple times with some fun money over the years, sold again last week at 105 after buying on the way down to 85 in March. It’s a great company that’s not going anywhere, but has been at its current price in previous years too. It’s pretty reliable to make small gains for fun, remembering of course to buy index funds for long term investing.
If you don't do stuff, then you don't do stuff.

inbox788
Posts: 7109
Joined: Thu Mar 15, 2012 5:24 pm

Re: Is Disney the most tempting value stock?

Post by inbox788 » Fri May 08, 2020 6:55 pm

statefan03 wrote:
Fri May 08, 2020 9:18 am
whereskyle wrote:
Fri May 08, 2020 8:46 am
https://www.cnbc.com/2020/05/08/shangha ... g-day.html

Perhaps I should have bought more!
Maybe. It's purely speculative. Who knows if this thing comes back twice as bad as before.
I want to know what happens when contact tracing links up someone who visited or worked at the park. It doesn't even have to be a possible or proven transmission, just a contact of someone who tested positive and might get tested or not. If the government-issued Shanghai Health QR code works, it would be really helpful. Or help in providing some empirical evidence that the transmission risk is not significant. We really could use such a tool for trying to identify and keep out higher risk individuals as well as take further action if someone is identified, but I'm not hopeful we'll have one anytime soon. I don't think it's a matter if if, but when and how many, and how they react and are forced to react.

Then again, cruises for 2021 are booking up, which bodes well for DCL.
"Two weeks ago, I would have said that everyone was sticking close to home, but no. Nobody's booking close in [this year] because they don't know what's going to happen," Tully says. "But for next year? They're booking everything, as if it's any normal year."
https://www.cntraveler.com/story/travel ... ng-up-2021

If you get in, get set for a bumpy ride and rough sailing.

Topic Author
whereskyle
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Re: Is Disney the most tempting value stock?

Post by whereskyle » Tue May 12, 2020 8:24 am

https://www.cnbc.com/2020/05/12/hamilto ... uly-3.html

Hamilton movie to skip theaters and go straight to Disney+.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

illumination
Posts: 672
Joined: Tue Apr 02, 2019 6:13 pm

Re: Is Disney the most tempting value stock?

Post by illumination » Tue May 12, 2020 12:45 pm

whereskyle wrote:
Tue May 12, 2020 8:24 am
https://www.cnbc.com/2020/05/12/hamilto ... uly-3.html

Hamilton movie to skip theaters and go straight to Disney+.
I just don't see this model being nearly as profitable as having movies an "event" where people go, and that's a huge part of Disney's profits are movie releases. Disney+ may have slit Disney's own throat. And the higher "Pay Per View" type fees some other studios are doing on a same day release, where like a new release is say $20+ I think it will be a hard sell.

You sort of feel like you get your money's worth when you pay and you get out of the house versus paying that much for a one time viewing on your TV. Something tells me a "free" show will be found instead in a lot of those situations.

I see movie theater attendance falling off a cliff, I'm something of a movie buff and even before Corona I barely went anymore, it was mostly to take my kids.

Topic Author
whereskyle
Posts: 876
Joined: Wed Jan 29, 2020 10:29 am

Re: Is Disney the most tempting value stock?

Post by whereskyle » Tue May 12, 2020 12:48 pm

illumination wrote:
Tue May 12, 2020 12:45 pm
whereskyle wrote:
Tue May 12, 2020 8:24 am
https://www.cnbc.com/2020/05/12/hamilto ... uly-3.html

Hamilton movie to skip theaters and go straight to Disney+.
I just don't see this model being nearly as profitable as having movies an "event" where people go, and that's a huge part of Disney's profits are movie releases. Disney+ may have slit Disney's own throat. And the higher "Pay Per View" type fees some other studios are doing on a same day release, where like a new release is say $20+ I think it will be a hard sell.

You sort of feel like you get your money's worth when you pay and you get out of the house versus paying that much for a one time viewing on your TV. Something tells me a "free" show will be found instead in a lot of those situations.

I see movie theater attendance falling off a cliff, I'm something of a movie buff and even before Corona I barely went anymore, it was mostly to take my kids.
Good points, no doubt.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

MotoTrojan
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Joined: Wed Feb 01, 2017 8:39 pm

Re: Is Disney the most tempting value stock?

Post by MotoTrojan » Tue May 12, 2020 12:56 pm

whereskyle wrote:
Mon May 04, 2020 3:14 pm
LFKB wrote:
Mon May 04, 2020 3:04 pm
Disney is not at all a value stock. Even after the share price has come down, the stock is still valued very highly on both a P/E and EV/EBITDA basis. A huge chunk of their earnings (parks, movies, ESPN, cruise ships) is in a really tough spot right now and the one bright spot if Disney Plus.
Interesting. I'm not sure about how long it has been held in VTV (Vanguard Large-cap Value ETF), but it's definitely there as of end of March. I know little about the index VTV tracks.
Large-cap value indexes like this take a tiny step in the direction of value, but come nowhere close to true deep exposure to the factor.

Here is a good example, in this case showing VLUE though.

https://alphaarchitect.com/2017/04/26/a ... gs.F1cuVbE

User avatar
fortfun
Posts: 2679
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Re: Is Disney the most tempting value stock?

Post by fortfun » Tue May 12, 2020 2:53 pm

Wanderingwheelz wrote:
Mon May 04, 2020 1:36 pm
willthrill81 wrote:
Mon May 04, 2020 11:59 am
Wanderingwheelz wrote:
Mon May 04, 2020 11:50 am
Elysium wrote:
Mon May 04, 2020 11:34 am
Never liked Disney, felt it was over-hyped, overcrowded, bad food, long lines, poor treatment of employees and environment. We tolerate many business with the excuse that they create jobs and are good for the economy. Perhaps we don't need Disney and the economy could survive without these big boxed areas that packs in millions. Perhaps parents and children could instead enjoy our vast national parks instead and have more happiness being closer to nature than these fake happy places like Disney.

That just sums up my thinking of why Disney may not be all that essential, and therefore perhaps not a good investment.
The “grail” National Parks are more or less “packed” the same as Disney World. Go to Yellowstone in August if you don’t believe me.
They aren't much cheaper either. The least expensive hotel room we could find in any of the towns surrounding Yellowstone was over $300/night (Holiday Inn Express), and most were well more than that. Sadly, visiting the national parks is often not an inexpensive venture anymore, if it ever really was.

Renting a motorhome to visit Yellowstone and the Grant Tetons in about six weeks will be cheaper than staying in any of the local hotels. Still, the total cost for a nine day trip there, including two days just on the road, will be almost the same as the eight night trip we made to Disney World last year, which included staying at the Polynesian resort.
I agree with everything you wrote! We own our RV so that gives us a bit of a “discount” since we spend more than 60 nights a year on the road. Once you’ve rented one, there’s a good chance you’ll want to own one, if your experience is like ours. Also, buy the NP annual pass ($80) if you think there’s a chance you’ll use it for some trips over the rest of the year.

Have fun!
We tent camp in the parks, or just outside. Usually, around $15-$20 per night. At some parks, we "boondock" for free, just outside the park on BLM land. So far, we have visited 31 parks. The two parks in Hawaii (Volcano and Halealaka) are the only two we've spent a significant amount of money on, but even those we used frequent flier miles and cheapish VRBOs. Sadly, we had to cancel the Florida Ntl. Parks due to Covid19 this spring break :(. BTW way, my favorite national park campground is Cottonwood Campground at the bottom of Grand Canyon Ntl. Park.

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