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Disney's Wonderful World of Content

Stocks in this article: DIS NFLX AMZN

Pixar has proved to be a money printing machine and if Disney didn't acquire it, they probably wouldn't be where they are today. Disney didn't stop there, acquiring Marvel in 2009 and Lucasfilm in 2012.

The Marvel takeover paid obvious dividends with the Iron Man trilogy and The Avengers having tremendous box office success. Marvel has plenty of gas left, with Captain America The Avengers 2 and Man of Steel (Superman) still left to debut.

The $4 billion deal for Lucasfilm was done for one obvious reason: Star Wars. Iger wanted to continue the saga and saw it as a huge opportunity, both on the big screen and on television, (don't forget, Disney runs the ABC network).

Although investors seemed skeptical at first about potentially overpaying, which was obvious in the price action after the deal was first announced, they seem to have faith in Iger. The first Star Wars film is due out in the summer of 2015.

Toss in the four movies Disney's Pixar division has planned between now and 2015 and you start to realize that there's lot of upside left.

Also don't forget Disney's deal with Netflix. Towards the end of 2012, it was announced that Netflix would begin streaming the following Disney partners on their platform: Pixar Animation Studios, Marvel Studios, Walt Disney Animation Studios and Disneynature.


While the financial terms were not disclosed, investors know that Disney received favorable terms if they dropped Starz for it. Let's put it this way, Disney didn't get the short end of the stick.

If content is king, then Disney has the castle.

-- Written by Bret Kenwell in Petoskey, Mich. .

At the time of publication the author is long DIS.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Bret Kenwell currently writes, blogs and also contributes to Rocco Pendola's Weekly Options Newsletter. Focuses on short- to intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.
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