Market Overview

'Star Wars' May Not Save Disney

Share:
'Star Wars' May Not Save Disney

There's no question that Walt Disney Co (NYSE: DIS) struck gold with its latest Star Wars film "Star Wars: The Force Awakens." The movie broke records around the world as fans flocked to cinemas in droves to watch it and merchandise relating to the film became a popular holiday gift item.

However, now that the hype surrounding "The Force Awakens" has begun to die down, some analysts are saying that Disney is going to need more than just the power of the force to revive its share price.

Sinking Shares

Over the past month, Disney shares have fallen 11.68 percent and some analysts have downgraded their opinions of the stock, saying the shares are overvalued. While Disney could bring in some $5 billion between box office sales and merchandise sales from "The Force Awakens," many believe that won't be enough to offset worries about the company's struggling TV business.

Related Link: How Much 'Star Wars' Is Really Worth To Disney

ESPN Struggling

While Disney has made an effort to create a presence in the online streaming space, the firm's ESPN sports channels are in a precarious position. As more people opt to cut the cord and move away from traditional cable, ESPN is in danger of being left out in the cold.

Sports fans now have more options than ever to watch on-demand content, making ESPN incrementally less appealing. Not only that, but many analysts believe Disney has overpaid for the rights to individual sports and will suffer if more subscribers jump ship.

Streaming Prospects

There have been rumors that Disney could consider developing an ESPN app that would allow customers to pay for the stand-alone service and watch sports on the go from their mobile devices, but so far, there has been no movement on this front.

Live sports have been one of the major draws keeping people connected to traditional cable, but that could be changing. This year, the National Football League streamed several of its games for free online, suggesting that in coming years the organization may be looking to branch out and get on board with the streaming revolution.

Image Credit: By User:Wiki Erudito [Public domain], via Wikimedia Commons

Posted-In: cord-cutting ESPNAnalyst Color Long Ideas News Markets Trading Ideas General Best of Benzinga

 

Related Articles (DIS)

View Comments and Join the Discussion!

VWR Acquires Therapak, Terms Confidential

EDAP Receives Japanese Approval for Quanta Litho Laser; Secures Exclusive Distribution Rights in Japan