Understanding Why Disney's Magical Express Is Ending

[maxairmike]

Florida always overbuilds in “booms”...and the stock market is pumped up on steroids...

don’t let cranes fool you. That is cash grab...not migration. The urban sprawl that occurred in the north is just starting there. There’s almost no actual population influx

We're nowhere close to "overbuilding" around here (Orlando) right now until the amount of homes available as vacation rentals turns into mostly residential, and even then I'm not sure if that would be enough inventory to sate the legitimate demand. And even the vacation rentals aren't seeing much of a slow down in construction around here. We're trying to be in the market for a home right now and it's just insane and the residential demand is legitimate.

 

[Sirwalterraleigh]

We're nowhere close to "overbuilding" around here (Orlando) right now until the amount of homes available as vacation rentals turns into mostly residential, and even then I'm not sure if that would be enough inventory to sate the legitimate demand. And even the vacation rentals aren't seeing much of a slow down in construction around here. We're trying to be in the market for a home right now and it's just insane and the residential demand is legitimate.

that is a national phenomenon on steroids...as I said.

and Orlando is overbuilding...but they never realize it until an economic slowdown and they hit the wall/ditch.

but that’s all academics...enjoy the ride

 

[Lilofan]

When there's a larger market correction prices won't tank because there's more housing than people need here, it will be because they can't afford the prices. Like I said, if there's an overbuilding it's in the vacation rentals, but I'm not sure let's say 50% becoming permanent residential (and that would probably be close to 1k units or more just on my current road alone) would make a serious dent in the residential demand we're seeing. You can say we're overbuilding, but someone is buying these homes, and I can tell you that where we've been looking and seeing price increases at least every weekend (sometimes more often), the sales are largely to actual people.

Central FL is building more and more apartment complexes too.

 

[Sirwalterraleigh]

When there's a larger market correction prices won't tank because there's more housing than people need here, it will be because they can't afford the prices. Like I said, if there's an overbuilding it's in the vacation rentals, but I'm not sure let's say 50% becoming permanent residential (and that would probably be close to 1k units or more just on my current road alone) would make a serious dent in the residential demand we're seeing. You can say we're overbuilding, but someone is buying these homes, and I can tell you that where we've been looking and seeing price increases at least every weekend (sometimes more often), the sales are largely to actual people.

well the brokers “think” they can protect themselves from loss using funny money the way they couldn’t during the housing crash.

“think”...we shall see. A lot of the same tricks short of CDS being used.

I’d love for the correction to be “mild”....for my own real estate and work interests...but I’m from Missouri and I’d have to see it (bad pun...I’m not from Missouri)

but also remember that when the economy gets a cold...Florida gets the flu (really bad pun)

 

[Sirwalterraleigh]

I think Central FL has the mentality if we keep building more and more people will come.

they do...same since 1965...and they’ve been ravaged by every major recession along the way for their mentality.

past is usually prologue

 

[UNCgolf]

Not everyone from the northeast moves to Florida when they decide to retire in the southeast. There are huge numbers that move to the Myrtle Beach area, for one -- something like 100k+ people moved there last decade and a bunch of those people were from NY and NJ.

 

[Lilofan]

Not everyone from the northeast moves to Florida when they decide to retire in the southeast. There are huge numbers that move to the Myrtle Beach area, for one -- something like 100k+ people moved there last decade and a bunch of those people were from NY and NJ.

Also Hilton Head/Bluffton SC is a favorite of retired monied Northerners.

 

[UNCgolf]

Also Hilton Head/Bluffton SC is a favorite of retired monied Northerners.

Yeah, it's multiple places up and down the southeastern coast. Even that stat about Myrtle Beach doesn't really give the full picture, because there are a lot of people moving to the NC beaches north of Myrtle. We have a house at Ocean Isle Beach in North Carolina and the number of housing communities built in the last decade or so is off the charts, and they're mostly full of people moving down from NY/NJ.

 

[HauntedPirate]

well the brokers “think” they can protect themselves from loss using funny money the way they couldn’t during the housing crash.

“think”...we shall see. A lot of the same tricks short of CDS being used.

I’d love for the correction to be “mild”....for my own real estate and work interests...but I’m from Missouri and I’d have to see it (bad pun...I’m not from Missouri)

but also remember that when the economy gets a cold...Florida gets the flu (really bad pun)

Laughed because of the Missouri pun. That was good.

 

[PirateFrank]

To be fair, I think there's room for both schools of thought. NY has indeed experienced a significant exodus over the past few years. It's not weather doing it all. It's politics. Its taxes. Its regulations. It's covid. It's not wanting to be stuck in a locked down state forever. So beyond the usual snowbirds taking up permanent residence in a sunny state - there are other reasons driving people out of NY. Whether they're heading to Florida - I'm not sure....But make no mistake, we're in the midst of a population decline here in NY.

 

[Sirwalterraleigh]

To be fair, I think there's room for both schools of thought. NY has indeed experienced a significant exodus over the past few years. It's not weather doing it all. It's politics. Its taxes. Its regulations. It's covid. It's not wanting to be stuck in a locked down state forever. So beyond the usual snowbirds taking up permanent residence in a sunny state - there are other reasons driving people out of NY. Whether they're heading to Florida - I'm not sure....But make no mistake, we're in the midst of a population decline here in NY.

I grew up near Pittsburgh...you don’t have to tell me about population exodus.

it’s money...it’s weather...it’s the collapse of any commitment to blue collar and opportunity...it’s changing demographics and the hard crash/cynicism of the last of the 20th century.

lots of things. Most are not new.

 

[david10225]

Not everyone from the northeast moves to Florida when they decide to retire in the southeast. There are huge numbers that move to the Myrtle Beach area, for one -- something like 100k+ people moved there last decade and a bunch of those people were from NY and NJ.

I live outside of North Myrtle Beach and I can affirm the housing boom here is in full swing along with tons of tourists.

 

[PirateFrank]

I grew up near Pittsburgh...you don’t have to tell me about population exodus.

it’s money...it’s weather...it’s the collapse of any commitment to blue collar and opportunity...it’s changing demographics and the hard crash/cynicism of the last of the 20th century.

lots of things. Most are not new.

Lower your defensiveness. I'm merely suggesting that the poster you were dismissing with your weather comment had a valid point....especially with NY, where increased population exodus is both a recent *and* new phenomena.

 

[Sirwalterraleigh]

Lower your defensiveness. I'm merely suggesting that the poster you were dismissing with your weather comment had a valid point....especially with NY, where increased population exodus is both a recent *and* new phenomena.

Its a discussion...which involves different opinions...it’s not “defensive”

I put out the numbers...which right now show a low 1 % ish population increase in Florida...not the 3-4% range in the 70’s and 80’s.

now...if they have a 6% next year...then you got something.

until then...the numbers don’t fit the narrative

 

[ParentsOf4]

When I used to post regularly on wdwmagic.com, I liked to believe I gained a bit of a reputation for producing charts.

It's been about 4 years since my last chart, so it's time for another.

Let's have a look at Per Room Guest Spending (PRGS), which Disney reports every fiscal quarter (i.e. 4 times each year) in its SEC filings.

Disney defines PRGS as follows:

Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.​

Disney uses PRGS to track how much you spend at the hotel. Most of this is the cost of the room itself, followed by food. Did you stop by the food court before or after your theme park visit? This is tracked in PRGC. Did you buy some souvenirs at the hotel store? This is tracked in PRGC.

Here's PRGS (per quarter) for the 10 years prior to 2020. (I decided not to include 2020. A disproportionate number of Value and Moderate Resort rooms were closed, skewing the numbers. This makes 2020 extremely difficult to compare to previous years using publicly available data.)

 

[Nubs70]

When I used to post regularly on wdwmagic.com, I liked to believe I gained a bit of a reputation for producing charts.

It's been about 4 years since my last chart, so it's time for another.

Let's have a look at Per Room Guest Spending (PRGS), which Disney reports every fiscal quarter (i.e. 4 times each year) in its SEC filings.

Disney defines PRGS as follows:

Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.​

Disney uses PRGS to track how much you spend at the hotel. Most of this is the cost of the room itself, followed by food. Did you stop by the food court before or after your theme park visit? This is tracked in PRGC. Did you buy some souvenirs at the hotel store? This is tracked in PRGC.

Here's PRGS (per quarter) for the 10 years prior to 2020. (I decided not to include 2020. A disproportionate number of Value and Moderate Resort rooms were closed, skewing the numbers. This makes 2020 extremely difficult to compare to previous years using publicly available data.)

View attachment 548414

Could you include 2020 to just visualize the impact of negative externalities?

 

[seascape]

When I used to post regularly on wdwmagic.com, I liked to believe I gained a bit of a reputation for producing charts.

It's been about 4 years since my last chart, so it's time for another.

Let's have a look at Per Room Guest Spending (PRGS), which Disney reports every fiscal quarter (i.e. 4 times each year) in its SEC filings.

Disney defines PRGS as follows:

Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.​

Disney uses PRGS to track how much you spend at the hotel. Most of this is the cost of the room itself, followed by food. Did you stop by the food court before or after your theme park visit? This is tracked in PRGC. Did you buy some souvenirs at the hotel store? This is tracked in PRGC.

Here's PRGS (per quarter) for the 10 years prior to 2020. (I decided not to include 2020. A disproportionate number of Value and Moderate Resort rooms were closed, skewing the numbers. This makes 2020 extremely difficult to compare to previous years using publicly available data.)

View attachment 548414

I miss your charts. Anyway, 2020 and 2021 are tough years. I expect the 4th quarter of the year to be back to normal so since that lines up with Disney's fiscal year, we can start to go forward and just skip the 2 years, October 2019 through September 2021.

Now, thinking about the company as a whole, the next fiscal year will be a killer. The studio will be back, themeparks back and Disney's newest source of money Streaming delivering over $24 billion in revenue from October 1, 2021 through September 30, 2022. Disney+ should have about 140 million customers October 1, Hulu over 45 million and ESPN+ 20 million. Combined with Star+ in Central and South America and the advertised supported Hotstar service in India, Disney will be right at Netflix's revenue numbers for the year. Streaming in the future and Disney will be the big winner.

 

[JoeCamel]

When I used to post regularly on wdwmagic.com, I liked to believe I gained a bit of a reputation for producing charts.

It's been about 4 years since my last chart, so it's time for another.

Let's have a look at Per Room Guest Spending (PRGS), which Disney reports every fiscal quarter (i.e. 4 times each year) in its SEC filings.

Disney defines PRGS as follows:

Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.​

Disney uses PRGS to track how much you spend at the hotel. Most of this is the cost of the room itself, followed by food. Did you stop by the food court before or after your theme park visit? This is tracked in PRGC. Did you buy some souvenirs at the hotel store? This is tracked in PRGC.

Here's PRGS (per quarter) for the 10 years prior to 2020. (I decided not to include 2020. A disproportionate number of Value and Moderate Resort rooms were closed, skewing the numbers. This makes 2020 extremely difficult to compare to previous years using publicly available data.)

View attachment 548414

Just one question for clarification if you will?
If the guest opts to pay as they go and not have room charging is their spending captured?

 

[Sirwalterraleigh]

When I used to post regularly on wdwmagic.com, I liked to believe I gained a bit of a reputation for producing charts.

It's been about 4 years since my last chart, so it's time for another.

Let's have a look at Per Room Guest Spending (PRGS), which Disney reports every fiscal quarter (i.e. 4 times each year) in its SEC filings.

Disney defines PRGS as follows:

Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.​

Disney uses PRGS to track how much you spend at the hotel. Most of this is the cost of the room itself, followed by food. Did you stop by the food court before or after your theme park visit? This is tracked in PRGC. Did you buy some souvenirs at the hotel store? This is tracked in PRGC.

Here's PRGS (per quarter) for the 10 years prior to 2020. (I decided not to include 2020. A disproportionate number of Value and Moderate Resort rooms were closed, skewing the numbers. This makes 2020 extremely difficult to compare to previous years using publicly available data.)

View attachment 548414

I bet if you compared that to price increases across the revenue streams...you’d detect a “shockingly unshocking” trend

 

[ParentsOf4]

Could you include 2020 to just visualize the impact of negative externalities?

All you have to do is ask.

The numbers for the 4 calendar quarters were $372, $0, $356, and $363.