Disney falls into a mouse trap

Yesterday, $DIS dropped 9.17%, faster than a fat chick in a rave. This large pile driver of a company finally sees a correction after its massive 2 year run from $71 back in 2014.

Yes, not funny. Many who were drawn to this stock recently because of the Marvel franchise and Star Wars are shitting alien poop as we speak. We interviewed Luke Skywalker and here’s what he thinks about this massive stock dump (pun intended)

But should investors like you pals and myself (mind you this stock has done incredibly well for me for the past year) be worried with this selloff? Lets lay out all the facts:

  • Disney has been the best performer in the DOW index year to date, carrying it up to its near all time high levels
  • $DIS is still up 18% for the year (Some cant even get 18% increase in annual sex from their own spouses. Worst thing is that sex is free)
  • All cable companies including CBS and FOX stocks had a beating on the same day -signalling an issue with a specific industry, not with a specific stock

Looking at all the pointers stated, its a BUY.

The very reasons $DIS’s selloff was so bad was because firstly, missing estimates for subscribers this quarter. But it wasn’t only $DIS, all cable companies too. Consumers are moving toward Netflix, a more convenient and way cheaper option to watch shows. Understandably, cable TV companies will have to face this threat together, and it doesn’t reflect on $DIS’s weakness as a company for growth prospects. If you want to talk about growth, go see the Avengers 2 box office number, close to $1.4 billion dollars. Its studio entertainment sector has been booming and analysts even expect for the Star Wars that’s going to be released this Christmas to knock those numbers harder than Chris brown knocked Rihanna out.

Secondly, this stock has not slowed down or corrected in the longest time. Thus, it was a chance some traders decided to collect profit. But if you were a long term holder like me, you’d see that you’re still up for the year, and how this stock could move so much higher with its future plans of Disneyland Shanghai and Star Wars and Captain America lined up in the near future.

Conclusion: This is a great great time to buy $DIS. It is currently trading at a 22 P/E ratio, a discount from where it was few days ago. Bob Iger has turned a little mouse into a behemoth of a company, and with the diversified product and services business Disney has, you can be rest assured this company will continue to produce high returns in the long run for you and your money.

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