Thursday is the Walt Disney Company (NYSE:DIS) made clear that it has no plans to join the increasingly intense merger and acquisition talk in the sector.
Disney is confident in its IP portfolio as rivals explore options
During the company’s fourth-quarter earnings call BofA securities analyst Jessica Reif Cohen asked whether Disney saw a role for itself in the expected round of media consolidation – especially as competitors face breakups and strategic overhauls.
CFO Hugh Johnston revisited this idea, noting that Disney’s content strategy over the past decade has already given the company one of the strongest intellectual property libraries in entertainment.
He pointed to past acquisitions such as 21st century fox, Lucasfilm And Pixar as the basis of its current power.
“We actually feel like we have a great portfolio and we don’t need to do anything,” Johnston said, adding that the company sees no need to pursue additional large-scale deals.
He also said Disney plans to monitor industry shifts but does not expect to participate in major transactions. “We like the hand we have right now. So I wouldn’t expect us to participate in making any major moves.”
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Paramount, Netflix are also pumping the brakes on mega deals
Disney’s stance comes as several major Hollywood players are tempering expectations for large-scale consolidation.
Earlier this week, David EllisonCEO of the newly combined Paramount Skydance (NASDAQ:PSKY)used its first earnings call to put to rest speculation linking the company to possible mergers.
While the studio will remain opportunistic if a deal will clearly accelerate its goals, Ellison says there are “no must-haves” on the M&A list.
Netflix Inc. (NASDAQ:NFLX) Co-CEO Ted Sarandos expressed a similar view during the streamer’s third-quarter earnings call in October. Sarandos said the company remains focused on building rather than buying.
Disney posts mixed fourth-quarter results
For the quarter, Disney reported adjusted earnings of $1.11 per share, beating expectations of $1.04. Revenue came to $22.5 billion, stable year-over-year and slightly lower than analyst expectations of $22.7 billion.
Price promotion: Walt Disney Co. closed Thursday at $107.61, down 7.77% for the day, with shares down another 0.11% to $107.49 in after-hours trading, according to Benzinga Pro.
Benzinga’s Edge Stock Rankings puts Disney in the 91st percentile for growth, reflecting a strong upward trend over the short, medium and long term. Click here for more information about Disney and its peers.
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