Market Overview

Are Disney Investors Overreacting?

Are Disney Investors Overreacting?

Investors are overreacting on the concerns of Walt Disney Co (NYSE: DIS), which is a good long-term stock according to CNBC's Fast Money Halftime Report team. Shares of Disney have been pressured on its dwindling subscriber numbers at its once-prized asset ESPN due to cord cutting and questions over who will succeed CEO Bob Iger once he retires.

The stock closed at $105.33.

Josh Brown has a Buy on Disney and said, "I think this company (or all the media companies) around the world has the best five-year runway going forward."

On the ESPN issue, Brown stated, "If you're a long time investor you look for those type of problems that Disney will probably find a way to figure out and you use that to your advantage. You don't sit on the sidelines saying the company is ruined because that is not an actual portrayal of the history of media."

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

Brown added that different ways of consuming content always come along. At first, there is a shock, but the companies that own the content eventually get it right find a way to make money.

"Right now there is cord cutting, but there are still people want to watch Frozen, Spiderman films, Star Wars films, they will find a way to get people watching ESPN in a way that is profitable for the company," Brown noted.

Meanwhile, Pete Najarian says the stock is a buy at the current levels (about $106), saying investors are overreacting on the cord cutting and succession concerns.

Commenting on the potential departure of Iger, Jon Najarian said, "This is not a guy who has to step down," and noted that losing Jeffrey Katzenberg was a "mistake" as that led to the formation of the Dreamworks Animation Skg Inc (NASDAQ: DWA) for which Katzenberg is the CEO.

However, Joe Terranova, who is the chief market strategist for Virtus Investment Partners, has a Hold on the stock.

"Stock made a great run since $88 and candidly I don't know whether there is $5 or $10 in the stock. Lots of issues out there right now and I don't know necessarily if this is the moment to step in and you may get it probably at the lower 90s again," Terranova said.

Brown added, "If you need to be immediately validated by your purchase, within a week or two then Joe is right, the next 5 points there is no trend here, it is very very muddy."

But, Brown said if an investor is on a long-term horizon, then the investor is getting the stock at a discount due to the cord cutting and succession issues.

Posted-In: CNBC Joe Terranova Jon Najarian Josh BrownAnalyst Color Long Ideas Media Trading Ideas Best of Benzinga


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