The 27.5 Billion dollar time bomb Iger left Chapek

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doctornick

Well-Known Member
SoFloMagic said:
I guess the issue is that they own 2/3 now, so they'd take double the loss of any attempt. What a mess. Shouldn't they have known in 2019 that Disney plus and peacock were coming?
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Hulu has a somewhat different function though as it has the Live TV component (competing more with services like Sling and YouTubeTV). For Disney it has the second function of being their Netflix or Prime equivalent so it has licensed contact (old movies TV) and original programming; unlike Disney+ in general this content is more all ages including a lot of adult only stuff (i.e. not family friendly).

Using the "bundle" with Disney+ and ESPN+ makes a very broad offering streamer if people like that. Not sure how much that is driving subs, though it does allow Disney to list a total number of subscribers higher than if any or all were the same service in the USA.

Someone could correct me if I am wrong, but I think Hulu is actually profitable these days. So owning all of it probably is not a bad thing.
 
Smiley/OCD

Smiley/OCD

Well-Known Member
larryz said:
What's keeping DIS from a three-way split and then selling another half-a-billion shares to raise the money? I mean, how many people on the fence would jump at a chance to buy tons of DIS at anywhere below $50?
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A 3 for 1 split could be a double edged sword…yes it’s opening the market up for the average investor, but at that price you’re opening yourself up for a hostile takeover or at the very least an Elon Musk investor attempting to buy a large controlling interest (I’m not saying that’s a bad thing…I think Elon could potentially be an overwhelming positive). I’m just thinking about the company’s take.
 
peter11435

peter11435

Well-Known Member
Smiley/OCD said:
A 3 for 1 split could be a double edged sword…yes it’s opening the market up for the average investor, but at that price you’re opening yourself up for a hostile takeover or at the very least an Elon Musk investor attempting to buy a large controlling interest (I’m not saying that’s a bad thing…I think Elon could potentially be an overwhelming positive). I’m just thinking about the company’s take.
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A split would lower the price of a share but would also increase the number of shares.
 
networkpro

networkpro

Well-Known Member
Original Poster
In the Parks
Yes
Smiley/OCD said:
A 3 for 1 split could be a double edged sword…yes it’s opening the market up for the average investor, but at that price you’re opening yourself up for a hostile takeover or at the very least an Elon Musk investor attempting to buy a large controlling interest (I’m not saying that’s a bad thing…I think Elon could potentially be an overwhelming positive). I’m just thinking about the company’s take.
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A split of that magnitude would, IMHO, precipitate a new board of directors. I wouldn't see a single person but perhaps a single or multiple investment group(s) going for a controlling interest.
 
CaptainMickey

CaptainMickey

Well-Known Member
SoFloMagic said:
Why not tank hulu and make it worthless at valuation
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Disney and Comcast already agreed Disney would pay a minimum of $9 billion dollars in January 2024. The deal has a minimum valuation of $27.5 even if it's worthless. And Disney pays more if Hulu is worth more then that. The deal actually discourages Disney from growing Hulu much before 2024 because they will have to pay more for the remainder of the company. Comcast is loving this deal.

This article has some good info on the subject:

Hulu is facing an existential crisis as Disney approaches a 2024 deadline to buy Comcast’s 33% stake​

 
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larryz

larryz

I'm Just A Tourist!
Premium Member
Smiley/OCD said:
The Wall St. people I talked to said it would be more appealing at the lower price…larger group, larger percentage for each…that’s what they said…idk I looked at my portfolio…can’t afford it yet
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If it dropped to <$50, I'd pick up a thousand shares...
 
peter11435

peter11435

Well-Known Member
Smiley/OCD said:
The Wall St. people I talked to said it would be more appealing at the lower price…larger group, larger percentage for each…that’s what they said…idk I looked at my portfolio…can’t afford it yet
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The lower price would certainly be more appealing to the average person and casual investor. But someone who was attempting a takeover would need to purchase three times as many shares to acquire the same percentage of the company.
 
JoeCamel

JoeCamel

Well-Known Member
peter11435 said:
The lower price would certainly be more appealing to the average person and casual investor. But someone who was attempting a takeover would need to purchase three times as many shares to acquire the same percentage of the company.
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I don't understand that thinking, if I buy shares no matter the price and the shares go up by x percent my holding goes up by x percent. If I buy more I earn more but the proportion is the same? Same for losses, what ends up in my pocket is the same percentage of investment no matter the price.
 
peter11435

peter11435

Well-Known Member
JoeCamel said:
I don't understand that thinking, if I buy shares no matter the price and the shares go up by x percent my holding goes up by x percent. If I buy more I earn more but the proportion is the same? Same for losses, what ends up in my pocket is the same percentage of investment no matter the price.
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If I buy 1 million shares at $1 dollar each of a company with 10 million shares. I have spent $1million on 10% of the company. If the price of a share doubles then my holding is now worth $2million but still represents 10% of the company.

If the company were to do a 2 for 1 split before my initial purchase. There would now be 20 million shares at $0.50 each. So to purchase 1 million shares would now only cost me half a million but it would only be a 5% stake in the company. I would still need to spend $1million to buy 2 million shares in order to purchase 10% of the company.
 
JoeCamel

JoeCamel

Well-Known Member
peter11435 said:
If I buy 1 million shares at $1 dollar each of a company with 10 million shares. I have spent $1million on 10% of the company. If the price of a share doubles then my holding is now worth $2million but still represents 10% of the company.

If the company were to do a 2 for 1 split before my initial purchase. There would now be 20 million shares at $0.50 each. So to purchase 1 million shares would now only cost me half a million but it would only be a 5% stake in the company. I would still need to spend $1million to buy 2 million shares in order to purchase 10% of the company.
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But the return on your investment is the same percentage. You have the opportunity to make more or lose more but if you get 10% on your money you get 10%
 

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