Disney Raises Dividend 33%, but Stock Lags Market

By Douglas A. McIntyre Published Dec 5, 7:45AM EST

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Disney Raises Dividend 33%, but Stock Lags Market — © Valerie Loiseleux / iStock Unreleased via Getty Images

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Key Points

Walt Disney Co. (NYSE: DIS | DIS Price Prediction) has raised its dividend by 33%.
That symbolic move does not signal that the company is out of the woods.
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Walt Disney Co. (NYSE: DIS) has raised its dividend by 33% to $1 per share. The payment will be divided in half and paid on January 16 and July 23. This does not make Disney a dividend play. The current payout is 0.8%, and even with the increase, it will be under 1%. The decision does not make up for the stock’s performance either. It is up 17% in the past two years, while the S&P 500 is 49% higher.

The stock’s performance is due to mediocre financial results and an uncertain future. In the most recently reported quarter, Disney’s revenue rose modestly to $22.6 billion year over year, and per-share earnings rose 79% to $0.25.

Its media and sports businesses, which include ESPN, its film studios, and legacy media, including ABC, did relatively well last quarter. However, Disney’s huge theme park division, which the company calls Experiences, struggled. Its revenue rose only 1% to $8.3 billion, and operating income fell 6% to $1.7 billion. The division is nearly half of Disney’s total operating income.

The open question about Disney’s parks is whether they have become too expensive. CNBC estimates a one-day park pass per person averages between $150 and $190.

The board of directors says CEO Bob Iger will be replaced in early 2026. However, Iger, who has been CEO twice, has delayed his planned retirement before. Iger gets the blame for the early failure of the Disney+ streaming service, which he launched in November 2019. It lost over $1 billion until turning a small profit in the past two reported quarters. Its profits remain at risk because of powerful competition from Netflix and Amazon Prime Video, each of which has a larger subscription base.

The dividend yield is hardly more than symbolic. It does not signal that Disney is out of the woods.

Disney Price Prediction and Forecast 2025-2030

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.