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TheStreet Open House

Disney Is Saving Money While Saving Mr. Banks

Stock quotes in this article: DIS



By saving money and making lots of money at the same time the company was able to announce on last month an annual cash dividend of 86 cents per share, up 15% from the previous year. The December payment is the 58th consecutive dividend payment to shareholders.

But at the Thursday close stock price of $74.80, this dividend payout represents a paltry yield of only 1.15%.

The Disney theme parks around the world are drawing increasing crowds and revenue. In 2013 its Parks and Resorts revenue increased 9%, to $14.1 billion, and the segment's operating income increased 17%, to $2.2 billion. That operating income increase should help drive sales profit growth when it next reports its quarterly earnings on Feb. 5.


The growth came from increases at the company's domestic parks and resorts, Disney Vacation Club, and Hong Kong Disneyland Resort. It would have been even better if not for a decrease at Disneyland Paris and higher pre-opening costs at Shanghai Disney Resort. Yes, Disney financial magic is working in the country with the world's largest population, and that holds part of the key to its future growth in operating income and sales profits.

Back when my children were young a tradition among many of my parental peers was to buy a share or two of Disney stock and ask the brokerage to send us the certificate so we could have it framed. It was such a colorful wall mounting in the children's room, and later on we celebrated what a good investment it was.

In fact Disney is still a good investment. The company operates in five segments -- Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products, and Interactive, which creates and delivers entertainment and lifestyle content across interactive media platforms. 

Disney is not only saving Mr. Banks, it's helping its investors to save for their future.

If you don't own any shares of DIS yet, you might want to wait until just before the Feb. 5 earnings date in case Disney management surprises to the upside. If it doesn't, and the shares fall on the earnings report, you can save more money by buying the aftermath's dip, if a dip is in the cards.

For now, the Disney magic touch keeps looking more like the Midas touch.

At the time of publication the author had no positions in any of the other companies mentioned in this article.



This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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

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Marc Courtenay is the founder and owner of Advanced Investor Technologies, LLC, as well as the publisher and editor of www.ChecktheMarkets.com.

Courtenay holds a Master's of Science degree in Psychology from California Polytechnic State University, and is a former senior vice-president of Investments for two major brokerage firms. He's been a fiercely independent investment "investigator" and a consulting contributor to the investment publishing world for over 30 years. In addition to his role as an investment publisher and analyst, he serves as a marketing consultant to the investment media industries.

In his role as a financial writer and editor, he specializes in unique investment strategies, growth with income stocks, overlooked investment themes, tax-advantaged themes, risk management, technologies to capture gains and reduce losses, real estate related opportunities,effective wealth preservation techniques, and the use of ETFs for diversification and asset allocation. He also follows and frequently writes about technology, health sciences, energy and resource companies. Because of his training and background in Clinical Counseling and Psychology, he enjoys writing about investor behavior, the herd mentality, how to turn investment mistakes into investment breakthroughs and the stock market's behavioral trends and patterns.
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