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A Spirited Perfect Ten
- Thread starter WDW1974
- Start date
ParentsOf4
Well-Known Member
In 21 years, Eisner grew Disney's company-wide revenue by 1829%, from $1.656B to $31.944B, a compound annual growth rate of 15.1%.
In 10 years, Iger has grown company-wide revenue by 64%, from $31.944B to $52.465B, a compound annual growth rate of 5.1%.
Eisner created the mega conglomerate now known as The Walt Disney Company. Eisner created the modern Walt Disney World.
Iger stabilized a company that was reeling from a post-9/11 economy and an Eisner that had made enemies with pretty much everyone.
Beyond the numbers, it's really not difficult to recognize that Eisner grew P&R by so much more than Iger.
Under Eisner, P&R added:
- Disney-MGM Studios
- Disney Animal Kingdom
- Euro Disneyland
- Disney's California Adventure
- Hong Kong Disneyland
- Typhoon Lagoon
- Blizzard Beach
- Wide World of Sports
- Downtown Disney (in its modern configuration)
- Disney Magic
- Disney Wonder
- 18 hotels or timeshares at WDW
- Shanghai Disneyland
- Disney Dream
- Disney Fantasy
The point is, Eisner added a lot while Iger mostly reconfigured what was already there.
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MerlinTheGoat
Well-Known Member
Do Disneysea and Studios Paris count as parks added under Eisner? Or did you have a reason for leaving those out (like majority ownership)?
lazyboy97o
Well-Known Member
I am guessing it is merely an oversight but I could see good reason for leaving them off. Tokyo DisneySEA wasn't a Disney project and Disney leadership probably saw it as a wonderful con game. Walt Disney Studios Park was required per the agreements with the French government.
Cesar R M
Well-Known Member
This means that if the stocks go boom, only the parks could be counted as real risk less assets?
I was talking financially. Plus a lot of the "good things" of Disney weren't exactly entered by Disney themselves, but by purchases.
Example, all Marvel Cinematic and Series are hardly to do with "Disney". But the Marvel creative team that was firing on all cylinders already when Disney took over.
The same could be said about Pixar.
Also you need a huge terrible mistake to make something as big as Star Wars to fail.
Its like having Barcelona or Real Madrid as your team. Only needs an horrible Manager to actually fail in these huge proven teams.
Cesar R M
Well-Known Member
Let me share some for your facepalming needs.
Feel free to select the captain of your choice.
"limited edition".
Does this means they use a different product name for this same product?
doctornick
Well-Known Member
I'm not sure what you mean by "talking financially". Financially, Disney has done great under Iger.
Your comment seemed to be related to how the general public has benefited from Iger being in charged. The parks have stagnated and raised prices significantly, so I wouldn't disagree with his time not benefitting -- actually hurting -- the public. But I don't see how one could ignore a ton of popular things that have been produced -- movies, TV shows, consumer products, etc.
As for your last point, I'll start by saying that I find it stupid that people make some artificial distinction between "purchases" and "in house" development. It's completely arbitrary -- if it's made by The Walt Disney Company, it's Disney. It doesn't matter what the source is of the IP, it's the product that matters. Furthermore, I think the resurgence of Disney animation at a minimum shows Iger has allowed historical Disney stuff to prosper.
To expand on my earlier point, this is stupid. First it ignores that Iger and Disney had the foresight to see the potential in Marvel and then effectively expand it.
But more importantly, it's just arbitrary. Ok, so Kevin Feige is fantastic and talented and how does a great job with the MCU. And he's Disney. Did he start out with Disney? No, he came with Marvel, but so what? If Disney simple hired him away from Marvel -- you know, lot's of employees come from somewhere else -- would that make him "Disney"? Why? It's so arbitrary. All that talent at Marvel is just as Disney now as, say, The Sherman Brothers (how dare they found Music World Corp before working for Disney!).
Marvel had potential before Disney took over. But they have absolutely exploded since the buyout. I think it's very naive to think that Disney ownership hasn't played a big role in that.
Sometimes being a top executive is seeing something that is undervalued and has upside and investing in it. I don't see the reason to diminish that aspect of what Iger has accomplished.
(Again, Iger has sucked for the parks. Not denying that.)
ford91exploder
Resident Curmudgeon
THIS
Iger's only real accomplishment has been to pump the stock price he has not grown the company organically as Eisner did and let's face it Iger continued and doubled down on some negative trends which started under Eisner. Effectively there were two Eisner era's Eisner+Wells and Post Wells,
The Eisner+Wells era was good because Wells kept the finances in order and kept Eisners ego in check. Post Wells Eisners ego nearly destroyed the company that's when you saw the Katzenburg and Ovitz debacles and the Pressler school of park management ie the only moving part in the park should be a cash register drawer. It's also when the quality cuts began which only accelerated under Iger's management.
ford91exploder
Resident Curmudgeon
As to directly providing content, Disney is going to need to step up their game several levels, They cannot even keep their web presence online 24x7x365, Sorry don't see that happening.
As to Disney's back catalog they have managed to devalue it with their vault concept, Check out @ParentsOf4 analysis of overall TWDC growth under MDE and Iger. The results are not flattering to Iger. One of the gems is that Iger has bought back 47 Billion dollars in stock alone, The physical assets of TWDC are only worth about 44 Billion. Just let that sink in for a moment.
Disney fans get all excited about the DHS add but that's a 10 year budget and here is how it breaks down
Stock Buyback estimated spend per year 6 Billion Dollars
Park upgrade estimated spend per year $350 Million Dollars
Disney will be spending 17 times the amount they are spending on park expansion on buying back stock. Most people just look at the EPS, But with the huge volume of buybacks one needs to normalize the EPS which then looks very flat over time.
So in 10 years TWDC will have purchased an additional 60 Billion in Stock
and spent 3.5 Billion on the parks. I'm SOOO excited this kind of underinvestment in PRODUCT is why I've dumped nearly all of my TWDC stock.
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FigmentJedi
Well-Known Member
ParentsOf4
Well-Known Member
The $47.2B I mentioned in an earlier post is the amount of treasury stock on the books, not the amount of stock repurchased under Bob Iger.
During Iger's tenure as CEO, the company has repurchased approximately $45.8B in company stock, equivalent to 87.6% of company-wide net income. During that period, the company spent $19.6B on P&R capital expenditures, equivalent to 37.6% of company-wide net income.
During Michael Eisner's tenure as CEO, the company repurchased $6.5B in company stock, equivalent to 29.7% of company-wide net income. During that period, the company spent $21.0B on P&R capital expenditures, equivalent to 96.2% of company-wide net income.
Eisner invested in growth initiatives, which is why company revenue grew by a compound annual rate of 15.1% under Eisner. Iger's much smaller 5.1% growth rate has been realized primarily through higher prices to the consumer. Without Iger's acquisitions of Pixar, Marvel, and Lucasfilm, I suspect nearly all of the company's growth has been through higher consumer prices.
Eisner created the modern The Walt Disney Company. Iger stabilized the company. Both improved profitability.
If you first think of yourself as a fan of Disney theme parks, then you should prefer Eisner. If you first think of yourself as a shareholder, then you should prefer Iger.
If you say "owning Disney stock is more important to me than visiting Disney theme parks", then Iger is your man.
If you say "visiting Disney theme parks is more important to me than owning Disney stock", then Eisner is your man.
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ParentsOf4
Well-Known Member
The Walt Disney Company neither owns nor operates Tokyo Disneyland. What happens there is determined by the Oriental Land Company, which has a licensing agreement with Disney.
I was lumping Walt Disney Studios Park (which opened in 2002) under Euro Disneyland but I see your point. I probably should have listed it as another park opened by Michael Eisner.
the.dreamfinder
Well-Known Member
I must say @ParentsOf4 , it is a bit surprising this chart hasn't come up again yet.
Don't invoke my name unless you want a graph.
It's an interesting topic. How much has Disney been investing in its Parks & Resorts segment under Iger?
By now, those who read my posts know that I rarely discuss absolute dollars because (for example) $100M spent in 1972 is not the same as $100M spent in 2015. IMO, inflation calculators are poor ways to compare eras so I don't use them. Similarly, spending $100M when a company operates 1 theme park is not the same as spending $100M when a company operates 5 theme parks.
To normalize the effects of both, I tend to look at percentage of revenue. In my experience, this is consistent with the thinking of many corporate leaders. Companies tend to set budgets with total revenue in mind. A company with $1B in annual revenue has different cost expectations than a company with $5B in annual revenue. Looking at the percentage of how much they invest gives insight into that company's business strategy.
The Disney of 1982 spending $1B to build EPCOT Center is much more aggressive than the Disney of 2015 spending $2B (i.e. 43% of $5B) to build Shanghai Disneyland. Whether you look at company-wide revenue or just Parks & Resorts revenue, the Disney of 1982 truly went out on a limb for EPCOT Center. In 2015, the entire Shanghai Disneyland venture could be a colossal failure and yet it would represent much less than one year of Disney's stock repurchase plan or only a fraction of one year of Parks & Resorts revenue.
Another item to consider when evaluating Disney's Parks & Resorts investments is depreciation. Amusement parks are physical asset intensive. Over time, these deteriorate and need to be repaired or replaced. Day-to-day maintenance is covered as an operating expense. However, long-term maintenance typically is covered as a capital expenditure.
Over the last 5 years, Disney's P&R depreciation has been about 10% of P&R revenue. If this seems high to you, then consider that it is lower than the other amusement park companies that I follow with the exception of Merlin Entertainments, which is only slightly lower. This is not because Disney's assets are aging less, but because Disney's revenue is strong relative to its physical assets.
Since companies don't report maintenance and growth capex separately, one method used estimate growth capex is to assume that maintenance capex should equal depreciation. At a theme park, this can be as minor as replacing rotting structures to a complete revamp of an attraction. For the purposes of determining how much a company is investing (versus simply maintaining), capex spent above depreciation can be considered growth capex.
With all of the above explanations out of the way
View attachment 88537
Please note that 1995 is a special case. There were multiple simultaneous smaller projects ongoing, the net effect being a huge spike in capex in 1994.
I look at this graph and conclude that Iger is the Disney CEO who has invested the least in his Parks & Resorts segment, even taking into account his large investments in Shanghai and on cruise ships. Iger might have spent over a billion dollars on NextGen but once that cost is spread over the several years it took to develop and deploy, it represents only a fraction of what Disney's Parks & Resorts segment is generating.
Ill see your mascara, and raise you a suggestive C3P0 tape dispenser
and for anyone up North, this item may make scraping ice off your windshield more fun (Wampa Arm ice scraper)
The winner though, is the Tauntaun sleeping bag!
Lee
Adventurer
Nice litmus test.
Puts me firmly in the Eisner camp.
asianway
Well-Known Member
What causes growth capex to go upside down? I'd think zero would be the floor. Thanks
Cesar R M
Well-Known Member
id totally buy the sleeping bag!
Andrew C
You know what's funny?
id totally buy the sleeping bag!
You're not fooling anyone. You already did!