Walt Disney (NYSE:DIS) stock fell 3.77% on February 26. Its shares have plunged 12% over the past week. Indices in the United States have been hit hard by the global selloff in response to the coronavirus outbreak.
Disney has entered 2020 as one of the most powerful entertainment companies the world has ever seen.
CEO Bob Iger announced that he would step down, effective immediately, this past week. Iger has served as CEO since 2005, overseeing Disney’s acquisitions of Lucasfilm, Marvel, and 21st Century Fox.
He said that the successful launch of Disney + and the integration of the latter acquisition made it an “optimal time” to transition to new leadership. His successor, Bob Chapek, will have big shoes to fill.
The company released its first-quarter 2020 results earlier this month. Its Disney + streaming service grew to 26.5 million subscribers, which was up from the 10 million sign-ups it reported immediately following its launch. Earnings per share rose to $1.53 and revenue hit $20.86 billion – both beat analyst expectations.
Disney expects its Asia-based operations to take a significant hit due to the coronavirus outbreak, which may negatively impact Q2 earnings.
Still, the stock offers solid value right now. Shares last possessed a price-to-earnings ratio of 19 and a price-to-book value of 2.4, both at favourable levels compared to industry peers. It is forecasting strong earnings growth going forward. The stock last had an RSI of 23, which puts it in technically oversold territory.
