Disney Is Losing

By Douglas A. McIntyre Published Mar 18, 6:35AM EDT

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Walt Disney Co. (NYSE: DIS | DIS Price Prediction) investors are likely losers no matter what happens in the board fight between Disney and Nelson Peltz of Trian Partners. Over the past two years, Disney’s stock has fallen 20% while the S&P 500 is 15% higher. Disney CEO Bob Iger may block Peltz from getting two board seats, but shareholders may look back and wish the raider had won. (See why failing Disney CEO Bob Iger made $31 million.)

It is too early to predict Trian’s performance. Barron’s describes the effort as a “long shot.” Iger has major support from several business leaders, the most recent of which was Jamie Dimon, the head of JPMorgan Chase, America’s largest bank. There is doubt that Peltz can get enough shareholders to vote for someone without any entertainment management background.

Peltz attacked Disney’s management based on its poor earnings, and much of what caused those has not gone away. At one point, before the pandemic, Disney’s studio was a hit-making machine. Since then, most of its largest films have underperformed at the box office.

Disney’s streaming business, led by Disney+, has over 150 million subscribers. However, this company division has lost billions of dollars and continues to post red ink. It is up against sector leaders of Netflix and Amazon and several other well-funded streaming services, including Apple’s.

ESPN, the leading cable sports network, has had to contend with people dropping their cable service for streaming. Walt Disney, Warner Bros Discovery, and Fox Corp. will launch a sports streaming network, but it is far too early to say how that will do.

Disney’s shareholder meeting is on April 3. The vote on who is on Disney’s board and who is not will be revealed then. Unless Disney’s share shares soar, its investors will still be stuck with a stock that has performed well below the market for two years.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.