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Walt Disney has been one of the biggest success stories of the post-2008 period, with the firm representing one of the most consistent performers; gaining over 700% from the 2009 low to 2015 high. However, with the recent downturn in stock markets, has this provided investors with the opportunity that many have been waiting for?
The Walt Disney brand has long been synonymous with timeless and memorable characters, drawing its strength from a huge back catalogue of valuable cartoons to then develop theme parks and a whole array of products. However, the transition of Cinderella’s castle into Elsa’s ice palace at Disneyland Florida highlights that the firm has finally begun to leave its roots behind.
The strategy of buying and developing new subsidiaries has given the firm a new lease of life and this is a large part of its success. The 2010 purchase of Marvel Entertainment and 2012’s LucasFilm buyout were particularly influential factors which have driven new diversified revenue streams.
The recent selloff was initially sparked by a disappointing earnings release, with revenues missing estimates and a cut to its outlook for profits in its cable business. However, this negative sentiment has developed given the wider Chinese fueled selloff, which at its worst had seen 25% wiped off Disney shares. However, there are signs that the buyers could be coming back to the fore.