24/7 Wall St. Insights

• Jim Cramer blamed Walt Disney Co. (NYSE: DIS) Bob Iger for taking a group of valuable entertainment assets and hurting them with mismanagement.
• Cramer supported his thesis with a New York Times article about management infighting at the entertainment giant.
• Also: Dividend legends to hold forever.

During Jim Cramer’s “Halftime Report” on CNBC, he answered a viewer question about Walt Disney Co. (NYSE: DIS). In his answer, he brutally attacked CEO Bob Iger for taking a group of valuable entertainment assets and hurting them because of mismanagement. Cramer also said that Disney had the best assets in the entertainment sector.

Cramer’s basic premise was that Iger continued to control the company after ousting his handpicked successor, Bob Chapek. Cramer insisted that Iger would continue to overshadow any new CEO in his role as executive chairperson. Cramer also mentioned that Disney could announce co-CEOs, further tightening Iger’s grip on the company.

The New York Times ran an article about Iger’s management and how fighting within the executive suite had damaged Disney’s prospects. Cramer used the article to support his Iger thesis.

Disney’s stock price also supports Cramer’s comments. It has decreased 18% in the past two years, while the S&P 500 is 44% higher.

Cramer’s argument about Disney assets is supported by history. Walt Disney founded the company in 1923, and since then, it has made some of the greatest films in history. Its theme parks are the industry standard. The first of these was Disneyland in 1955. Today, the parks are host to tens of millions of people a year.

Cramer’s point is that Iger has ruined much of what he built himself. This includes his acquisitions of Pixar, Marvel, and 21st Century Fox.

If Cramer is right, Disney’s stock will not recover while Iger is in charge.

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