News Reedy Creek Improvement District and the Central Florida Tourism Oversight District

[LAKid53]

Where do people keep getting the idea that Disney is short on cash?

Because they listen to people who couldn't read an income statement or balance sheet if their life depended on it.

 

[Sirwalterraleigh]

Where do people keep getting the idea that Disney is short on cash?

It’s being floated as a part of political game.

Financially, Disney is fine - like they always are…
…in terms of Wall Street? They’re “in trouble”…but that means nothing as it’s just complaining from people who generally don’t need the money

 

[seascape]

The more I think about these two cases and 2 bills, the more I think the Legislature is either extremely stupid or intentionally did things to harm the States case. The February 9th bill is post the new state constitution and authorizes the "WDW special district." Therefore making it extremely difficult to pass a new repeal of it because it would have to be directly against Disney. So did the Legislature intentionally harm the case to screw DeSantis or were they just stupid. If Disney wins their case, you can be sure they will use the February 9th bill as proof the District was authorized by the Legislature and the bill was signed by DeSantis. The original repeal was aimed at all districts pre new constitution that were not reaithorized post new constitution and The WDW land would no longer meet that condition.

 

[flynnibus]

The more I think about these two cases and 2 bills, the more I think the Legislature is either extremely stupid or intentionally did things to harm the States case. The February 9th bill is post the new state constitution and authorizes the "WDW special district." Therefore making it extremely difficult to pass a new repeal of it because it would have to be directly against Disney. So did the Legislature intentionally harm the case to screw DeSantis or were they just stupid. If Disney wins their case, you can be sure they will use the February 9th bill as proof the District was authorized by the Legislature and the bill was signed by DeSantis. The original repeal was aimed at all districts pre new constitution that were not reaithorized post new constitution and The WDW land would no longer meet that condition.

They had no use for the first bill after knowing they had to make the second. The fact it basically nullifies the first is the point. It in effect replaces the action of the first

 

[Vegas Disney Fan]

Where do people keep getting the idea that Disney is short on cash?

Because we read the news, it’s no secret they went $70 billion in debt to buy Fox/Hulu a few years ago (and still owe about half that amount), it’s also no secret they took out another $10 billion in credit during Covid.

It’s also no secret that they’ve been hemorrhaging money on D+ the last couple years and that their stock has underperformed the market. Also no secret they are making cuts and laying off people left and right.

Disney may have $10 billion cash in hand but they are also about $45 billion In debt.

Are they in trouble? Nope, they can easily manage this situation with their billions in revenue, but the last half decade hasn’t been good for Disney and it’s going to take a few more years for them to get out of the hole they’ve dug.

 

[flynnibus]

Because we read the news, it’s no secret they went $70 billion in debt to buy Fox/Hulu a few years ago (and still owe about half that amount), it’s also no secret they took out another $10 billion in credit during Covid.

It’s also no secret that they’ve been hemorrhaging money on D+ the last couple years and that their stock has underperformed the market. Also no secret they are making cuts and laying off people left and right.

Disney may have $10 billion cash in hand but they are also about $45 billion In debt.

Are they in trouble? Nope, they can easily manage this situation with their billions in revenue, but the last half decade hasn’t been good for Disney.

Setting up credit and getting emergency loans setup as precautionary were proactive moves to protect their liquidity when covid gave so much uncertainty. Highlighting that here is really misleading- its not liability risks.

70bil was not what they were in the hole for. Again pretty misleading.

Carrying some debt is normal- its good use of money typically. What concerns should be over is it’s burden and how volatile it could be. Both non issues with disney’s situation.

And disney is still very much cash flow positive. It is also not accumulating debt due to operations. Aka it’s sustainable without borrowing or eating into reserves. Disney had divisions in the red due to spending- which is why they can easily reign that in and restructure where it makes sense to optimize.

The threat to disney is the uncertainty of key future segments of how media will function in the future. Disney has not convinced the market they have the formula of how to grow from what they have today to the future where the whole world of movies, broadcast, and DTC changes. The threat to the revenue targets in the near term is what is spooking the market.

Not “financial health”. They wonder what disney will keep/reshape from fox because they want to know what the potential is… not because they think it will bring the company down.

 

[celluloid]

Disney may have $10 billion cash in hand but they are also about $45 billion In debt.

People should again, wonder how Ernest that statement, not promise, is to spend 17 billion dollars on WDW in the next ten years is and why it will be nothing bigger than what is already spent.
If it is, it needs to be.

Seriously wild that Willow, a show that was just produced and released is already being pulled off Disney Plus.

 

[GoofGoof]

Because we read the news, it’s no secret they went $70 billion in debt to buy Fox/Hulu a few years ago (and still owe about half that amount), it’s also no secret they took out another $10 billion in credit during Covid.

It’s also no secret that they’ve been hemorrhaging money on D+ the last couple years and that their stock has underperformed the market. Also no secret they are making cuts and laying off people left and right.

Disney may have $10 billion cash in hand but they are also about $45 billion In debt.

Are they in trouble? Nope, they can easily manage this situation with their billions in revenue, but the last half decade hasn’t been good for Disney and it’s going to take a few more years for them to get out of the hole they’ve dug.

All of this is true. It also doesn’t show the company being short on cash. Having debt is not an issue unless the cash needed to manage the debt exceeds the cash generated by the business. DIS has $6B of cash flow from operations annually. Their debt service requirements for the next 5 years require significantly less than $6B annually. Fitch’s DIS credit rating is A- which is solidly in the investment grade category. You don’t get an investment grade rating if you are short on cash. It also means they can borrow at the cheapest rate available so provides even more stability. Below is the analyst ratings for DIS from WSJ. 22 positive and 8 hold with no negative. Again, this shows analysts who actually follow the company don’t view it as struggling or short on cash. The stock price has not performed well in the last few years and there are certainly issues with streaming and traditional networks but I have seen no indication that the drag on the stock has anything to do with being short on cash.

 

[GoofGoof]

People should again, wonder how Ernest that statement, not promise, is to spend 17 billion dollars on WDW in the next ten years is and why it will be nothing bigger than what is already spent.
If it is, it needs to be.

Seriously wild that Willow, a show that was just produced and released is already being pulled off Disney Plus.

I think as parks fans we will be disappointed at what that $17B actually gets us. It seems like a lot but they spent that over the last decade too so if your expectation is some new rides and maybe a new land or 2 then it’s likely you won’t be too disappointed. If you envision much more than that it’s likely you will be disappointed. I am setting cautious expectations but would love to be pleasantly surprised. I don’t think the company will have to reduce the amount due to financial performance. The parks are the cash cow and they know you need to spend some to keep them going. It’s not a risky place to invest money for them.

Disney+ is a less certain financial proposition. The segment is losing money so cutting costs makes more sense. Every streaming service is experiencing this to an extent. You need content to attract subscribers but eventually you also need to turn a profit and have positive cash flows.

 

[Vegas Disney Fan]

All of this is true. It also doesn’t show the company being short on cash. Having debt is not an issue unless the cash needed to manage the debt exceeds the cash generated by the business. DIS has $6B of cash flow from operations annually. Their debt service requirements for the next 5 years require significantly less than $6B annually. Fitch’s DIS credit rating is A- which is solidly in the investment grade category. You don’t get an investment grade rating if you are short on cash. It also means they can borrow at the cheapest rate available so provides even more stability. Below is the analyst ratings for DIS from WSJ. 22 positive and 8 hold with no negative. Again, this shows analysts who actually follow the company don’t view it as struggling or short on cash. The stock price has not performed well in the last few years and there are certainly issues with streaming and traditional networks but I have seen no indication that the drag on the stock has anything to do with being short on cash.





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But the question wasn’t “is Disney healthy?”, or “is carrying debt a normal part of operating a business”, it was “where are people getting the idea they are short of cash?” That was all I was answering, Disney has very publicly taken on a ton of debt over the last few years, it shouldn’t be a surprise people associate that with them being a bit cash strapped.

 

[Vegas Disney Fan]

Setting up credit and getting emergency loans setup as precautionary were proactive moves to protect their liquidity when covid gave so much uncertainty. Highlighting that here is really misleading- its not liability risks.

70bil was not what they were in the hole for. Again pretty misleading.

Carrying some debt is normal- its good use of money typically. What concerns should be over is it’s burden and how volatile it could be. Both non issues with disney’s situation.

And disney is still very much cash flow positive. It is also not accumulating debt due to operations. Aka it’s sustainable without borrowing or eating into reserves. Disney had divisions in the red due to spending- which is why they can easily reign that in and restructure where it makes sense to optimize.

The threat to disney is the uncertainty of key future segments of how media will function in the future. Disney has not convinced the market they have the formula of how to grow from what they have today to the future where the whole world of movies, broadcast, and DTC changes. The threat to the revenue targets in the near term is what is spooking the market.

Not “financial health”. They wonder what disney will keep/reshape from fox because they want to know what the potential is… not because they think it will bring the company down.

Misinterpretation is probably a better phrase than misleading, if people aren’t aware of all the details of running a business, or the finer details around Disneys financials, I don’t think it’s that surprising many equate taking on massive debt with being cash strapped.

 

[Sirwalterraleigh]

But the question wasn’t “is Disney healthy?”, or “is carrying debt a normal part of operating a business”, it was “where are people getting the idea they are short of cash?” That was all I was answering, Disney has very publicly taken on a ton of debt over the last few years, it shouldn’t be a surprise people associate that with them being a bit cash strapped.

They reality is they still have $10 bil cash on hand and could borrow any amount of money they want on their terms with a wink and a thumbs up…
No matter the stock price.

 

[Vegas Disney Fan]

They reality is they still have $10 bil cash on hand and could borrow any amount of money they want on their terms with a wink and a thumbs up…
No matter the stock price.

But how many people outside of us Disney nerds know how much cash they have on hand? That was the only point I was trying to make, I just don’t think it should be surprising that many of the 99.99% who don’t track Disney financials (just typing that made me realize we’re all a bit weird) equate taking on debt with being low on cash.

 

[flynnibus]

Misinterpretation is probably a better phrase than misleading, if people aren’t aware of all the details of running a business, or the finer details around Disneys financials, I don’t think it’s that surprising many equate taking on massive debt with being cash strapped.

aka misunderstand and then be unaware of their misunderstanding... and then worse... doubling down on their misunderstanding instead of taking in other information. That's how we get here.

 

[flynnibus]

But how many people outside of us Disney nerds know how much cash they have on hand? That was the only point I was trying to make

What you are highlighting is 'disney nerds who want to talk about financials but are actually ignorant of the subject'. The people that actually are interested/concerned in financial health as investing do know how to interpret the key data points. It's apparently the Disney nerds drifting out of their lane... not the other way around.

, I just don’t think it should be surprising that many of the 99.99% who don’t track Disney financials (just typing that made me realize we’re all a bit weird) equate taking on debt with being low on cash.

Or what you are saying is 99.99% of people are willing to post about things before they get informed about it?

 

[mikejs78]

Disney may have $10 billion cash in hand but they are also about $45 billion In debt.

Disney has very publicly taken on a ton of debt over the last few years

They do not have "a ton of debt". Comcast has about $100b in debt and $5.5b cash on hand - more than double the debt of Disney with half of the cash on hand of Disney. Yet I don't here people here saying Comcast is in dire financial straits and are deep in debt.

 

[Lilofan]

They do not have "a ton of debt". Comcast has about $100b in debt and $5.5b cash on hand - more than double the debt of Disney with half of the cash on hand of Disney. Yet I don't here people here saying Comcast is in dire financial straits and are deep in debt.

Disney is a front page news item . Heck even when there is a local police sting and they arrest a number of folks up to no good the emphasis is on the Disney cast member who got arrested.

 

[GoofGoof]

But the question wasn’t “is Disney healthy?”, or “is carrying debt a normal part of operating a business”, it was “where are people getting the idea they are short of cash?” That was all I was answering, Disney has very publicly taken on a ton of debt over the last few years, it shouldn’t be a surprise people associate that with them being a bit cash strapped.

I don’t think most of the people saying they believe Disney is cash strapped have any idea how much debt they actually have or better yet if they are aware whether $30B of debt is a lot or a little for a company the size of TWDC. My point is anyone who is aware of the financials knows that cash is not an issue. There are other issues for sure but cash ain‘t one of them.

 

[seascape]

Disney's financial health has nothing to do with the RCID, CFTOD dispute. Disney is not in financial difficulty no matter what some here or on stupid YouTube videos say. Plus some of those people have no idea what they are talking about, or why else would they be working in a 2nd or 3rd world country?

 

[celluloid]

I think as parks fans we will be disappointed at what that $17B actually gets us. It seems like a lot but they spent that over the last decade too so if your expectation is some new rides and maybe a new land or 2 then it’s likely you won’t be too disappointed. If you envision much more than that it’s likely you will be disappointed. I am setting cautious expectations but would love to be pleasantly surprised. I don’t think the company will have to reduce the amount due to financial performance. The parks are the cash cow and they know you need to spend some to keep them going. It’s not a risky place to invest money for them.

Disney+ is a less certain financial proposition. The segment is losing money so cutting costs makes more sense. Every streaming service is experiencing this to an extent. You need content to attract subscribers but eventually you also need to turn a profit and have positive cash flows.

17 billion is status quo for a decade at current WDW, and it will probably be pretty lean as all departments tend to not do as well as the last couple decades.

Netflix ditched Marvel for a reason with multiple series and focused on a fewer in house creations that were much less budget so better ROI that covers more production when they get hits.

Disney did not listen and oversaturated three to four big budget series for Star Wars and Marvel.
It is going to take awhile and be lean before it is likely to get better for them, and the way writers are being treated are not going to get them much rushed projects going to diversify.

They will streamline and Disney will just be the obvious hits which will create the cycle.

The hubris.