Walt Disney Co DIS has seen its share of problems over the last couple of years with the COVID-19 pandemic impacting its parks and theatrical releases. The company has also managed to get itself into controversy with discussions over several legal decisions.
Here’s a look at how shares have done since current CEO Bob Chapek took over the company.
What Happened: On Feb. 25, 2020, Disney announced Bob Chapek would become the new CEO of the company, effective immediately. Chapek, who previously was the chairman of the Parks, Experiences And Products segment, replaced Bob Iger.
Iger was named the CEO of Disney on March 13, 2005, as the replacement to longtime CEO Michael Eisner, who became CEO back in 1984.
“With the successful launch of Disney’s direct-to-consumer businesses and the integration of Twenty-First Century Fox well underway, I believe this is the optimal time to transition to a new CEO,” Iger said.
Iger was set to stay on as chairman through 2021, a position that ended earlier than expected due to a potential falling out between Iger and Chapek.
Things have not been easy for Chapek given the macroclimate of the pandemic and rising inflation over the past two years.
Chapek has upset many Disney faithful with a focus on the streaming business instead of the parks and also adding several products such as Genie+ and Lightning Lane that make a trip to the theme parks more expensive.
The current Disney CEO also faced high expectations as Iger led the company through acquisitions of Marvel, Lucasfilm, Pixar and Twenty-First Century Fox and greatly improved the share price of Disney stock.
Investing $1,000 In Disney Shares: Sometimes investing in stock when a new CEO is named can be a strong bet on the future of the company. New CEOs can bring fresh ideas, turnaround plans and put a larger emphasis on acquisitions or spinoffs.
An investor could have purchased 7.47 shares of Disney on Feb. 25, 2020, based on a high of $133.94.
The 7.47 shares of Disney would be worth $785.92 today, based on Wednesday’s $105.21 closing price for Disney shares.
This represents a decline of 21.4% since Chapek took over the CEO role two years ago.
For comparison, investors could have bought 36.08 shares of Disney when Iger took over as CEO with $1,000. That $1,000 investment would have returned 383% through Feb. 25, 2020, and would still be up significantly if held.
Iger’s turn as CEO of Disney generated an average annual return of 25.5% for Disney shareholders, not including dividends.
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