The proxy battle over media company Disney (NYSE:DIS) is heating up as current CEO Bob Iger has reinforcements. Investors, meanwhile, are taking a mostly wait-and-see stance, sending Disney up fractionally in the closing minutes of Friday’s session.
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New reports note that ValueAct Capital, an investment firm allied with Iger, has released a whitepaper demonstrating why investors should stay away from Nelson Peltz and his activist effort to reshape the board. The ValueAct report also offered up a slate of strategic ideas—at least some of which will likely have to be put into effect if the old board holds its position—and they’re fairly familiar.
For instance, ValueAct wants Disney to “lean into parks” and “move beyond the streaming wars.” It wants Disney to improve both “consumer experiences” and “advertising technology,” and in perhaps the most radical idea, wants Disney to “…work with the other studios to test ideas and create wins.” It’s not hard to remember the win that was Who Framed Roger Rabbit, complete with Disney and Warner (NYSE:WBD) characters in the same film.
Who Suffers? The Slate.
Meanwhile, the proxy battle and other conditions have led to Disney quietly canceling some films, including some that no one really knew existed. Signs have emerged, though, suggesting what those might have been. An Armor Wars spin-off for Iron Man got cut, thanks largely to the poor performance of Secret Wars.
Meanwhile, a planned Shang-Chi and the Legend of the Ten Rings sequel also appears shuttered due to scheduling issues with the Avengers line. At least some of the problems can also be traced back to “superhero fatigue.”
Is Disney a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on DIS stock based on 17 Buys, four Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 15.4% rally in its share price over the past year, the average DIS price target of $117.90 per share implies 6.75% upside potential.
