Back before Disney (NYSE:DIS) took a stake in the “Don’t Say Gay” debate and the Florida state government decided to fight back tooth and nail, Disney was planning some expansion in the area. That’s now on hold and shareholders sort of rewarded Disney by sending it up just over 1% in Thursday’s trading.
Original plans, based on an internal memo at Disney, noted that Lake Nona—a section of Orlando—would have seen an entirely new campus assembled therein. Said campus would have hosted thousands of Californian employees, but now, the project has been shuttered outright. Word within the memo itself blamed “…new leadership and changing business conditions” for the cancellation. Worse yet, the memo also noted that some Californians had already transplanted themselves ahead of the move, which will now no longer be. Thus, Disney would confer individually with employees about their “situation.”
However, that cancellation doesn’t mean that Disney isn’t putting investment elsewhere in its Florida operations. Not long ago, Disney announced plans for updates at the park itself, expansion of current parks, and even more cruise ships added to the Floridian fleet. The news comes at a good time; already, some are concerned about Disney’s streaming video operations. Two consecutive quarters of streaming subscriber losses can’t help. Further, Disney is also poised to shut down its high-stakes Galactic Starcruiser hotel experience. The Halcyon will be scuttled this September, as tickets proved too pricey for many parkgoers.
Yet, analysts remain squarely on Disney’s side. With 14 Buy recommendations and four Holds, analyst consensus calls it a Strong Buy. Further, thanks to its average price target of $127.60, Disney stock offers investors a 36.09% upside potential.
