ford91exploder
Resident Curmudgeon
Disney's stock price is vulnerable to macroeconomic events though which by definition are out of the scope of disney's control.
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Iger out in 2018
- Thread starter enomi
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Disney's stock price is vulnerable to macroeconomic events though which by definition are out of the scope of disney's control.
RobidaFlats
Well-Known Member
This is one of the most frequently forgotten issues with using stock price as a barometer for anything.
An argument can be made that the current stock boom is due to interest rates being so low that non-equity markets are yielding practically nothing and so more money is in stocks seeking a better return. This is something over which companies have absolutely no control. On the other side, some market selloffs can be argued to be due to emotional panics with no basis in economic realities. That is also something that companies have no control over.
ParentsOf4
Well-Known Member
In the first quarter of FY2005, while Michael Eisner still was CEO, Disney repurchased $11M in company stock.
Iger was named CEO-elect in March 2005. For that quarter, stock repurchases jumped to $433M.
For the last 2 fiscal quarters of 2005, stock repurchases totaled nearly $1.976B.
In the first half of fiscal year 2006, Disney CEO Iger spent another $1.697B in stock repurchases.
Over his entire 21-year tenure at Disney CEO, Michael Eisner spent a bit under $4.1B in stock repurchases.
Iger spent more in his first 5 quarters as CEO-elect/CEO than Eisner spent in 21 years as Disney CEO.
Magenta Panther
Well-Known Member
SorcererMC
Well-Known Member
Absolutely. Like x10. I was really thinking of TWDC stock price in terms of what the company itself can do to increase it; it is subject to the whims of the markets of course.
SorcererMC
Well-Known Member
It's just good experience for when he's a member of Congress!
Believe it or not, I don't hate Iger; I reserve my wrath mostly for political leaders
. Maybe that means later I'll luck out?2351metalcloud
Active Member
A Disney company like 'Walt Disney Studios Motion Pictures' or 'Buena Vista Pictures' or 'Touchstone Pictures' is the one that distributes many Disney/Marvel/Pixar movies. Doesn't that money get spread around for other stuff?
Plus there's merchandise and tv deals for movies besides just money from box office ticket sales.
Marc Davis Fan
Well-Known Member
Part of me wishes Disney would buy back all of its stock and become privately-held, so it no longer needs to answer to Wall Street's demand for constant short-term gains.
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montyz81
Well-Known Member
"Frozen"?????
ford91exploder
Resident Curmudgeon
Believe it or not, I don't hate Iger; I reserve my wrath mostly for political leaders
The ONLY way Iger is getting into political office is as an political appointee, Just look at Iger's cringeworthy performance at the NFL bid (yes there is video for the masochistic) and tell me how he's going to perform on the campaign trail. The guy has the personality and delivery of a dead fish.
ford91exploder
Resident Curmudgeon
The stock buybacks would actually be defensible if they were part of a long term strategy to take Disney private like Dell.
ford91exploder
Resident Curmudgeon
Based on the size of MOST of Eisner's buybacks, It's probably safe to assume that many of them were for ESOP and other stock based compensation plans where Disney needed shares. Much like the small repurchases most tech companies do rather than dilute the stock with new shares they repurchase shares needed/used in stock based compensation plans.
And you, of course, know that can't be the reason?
ford91exploder
Resident Curmudgeon
Because IF that were the reason for the repurchases Disney would be required to state such in their disclosures as has every other US public company which repurchased stock with the intent of going private as that intent has a 'material' effect on the company going forward, Since Disney has not done so the reason must be that they are simply supporting their stock price.
No 'special' insight needed on this one
I would have to defer to @MichWolv on this one. Maybe they are only thinking about that option in the future, and as such, would not have to declare it as of yet. You have to bet that the execs are just as tired of Wall St as the rest of us are.
If the decision has been made to go public (or attempt to do so), that disclosure would likely be required. However, repurchases that are being done with a view to possibly making going private easier in the future, should the company decide to do so, wouldn't trigger a disclosure requirement. That being said, the possibility of Disney planning (or even considering) going private without a new investor putting up huge money is almost inconceivable. Dell had Michael Dell. Disney has no such large owner.
Wrong. There are two main reasons that companies repurchase stock. First, because they believe that the market is undervaluing the company and therefore buying its own stock is a good investment. While you could describe that as "supporting the stock price", that would be an inordinately pejorative way of describing it. Second reason is because the Company has decided it wants to return cash to shareholders, and chooses to do it via stock repurchases rather than a dividend. I find repurchases to be a more efficient means of returning cash shareholders, as it allows shareholders to decide whether to turn in all or a portion of their holdings for cash, rather than requiring them to do so, as a dividend would.
The execs are no doubt tired of some of Wall Street's tendencies. But the access to cheap financing overwhelms all of that. And the math makes it easy to see why. With a market cap of $163 billion, every 1/100th of a percentage point less that the market demands as a return on investment implicitly saves the company $16.3 million per year.
SorcererMC
Well-Known Member
Iger is a presidential appointee to the US Export Council (intl tourist $ counts as exports in calculating GDP), since at least 2012 and I haven't found the exact time frame. He is still on it as far as I can tell. Recall the 2012 WDW Main St speech re: issuing visas and tourism industry jobs, see also March 2013 US Export Council remarks by President Obama, specific to WDW.
I'm already thinking of campaign slogans....and yes, Iger lacks a certain charisma that is usually typical of (successful) politicians.
epcotWSC
Well-Known Member
IDK, I think it's a fairly easy to use repurchases to support the stock price and many companies do it for that reason. IBM had been doing it for many years in order to increase EPS (to hit their now defunct road maps and increase shareholder value)... however, it's also easy to see that it was (and continues) to be used as a way to prop up the share price on a company that hasn't had revenue growth in over 4 years.
Of course Disney is in a much different situation than IBM (Disney's actually growing), but it is valid to consider that a company may be buying back its stock at least partially to keep share price stable or even increase it more than it would have otherwise.
Of course Disney is in a much different situation than IBM (Disney's actually growing), but it is valid to consider that a company may be buying back its stock at least partially to keep share price stable or even increase it more than it would have otherwise.