The Shanghai Disney Resort will not only translate into higher earnings, but it can also give a boost to the company's brand in China. This could result in better performance in consumer products, movies and television operations. It's a big opportunity.
Disney will, however, face tough competition. Its rival Comcast's Universal Studios will pump $500 million in capital expenditures into further develop its theme parks.
In terms of market cap, Comcast is slightly smaller than Disney -- the difference in their market cap is just $5 billion -- but its Universal Studios unit is significantly smaller than Disney's parks and resorts segment. According to their comparable quarterly results, the growth of Disney's theme parks segment has easily outpaced growth at Universal Studios. Moreover, Disney will also have to deal with the rising threat from 21st Century Fox (FOX), which is also looking to diversify its business into movie-inspired theme parks.
At the time of publication, the author held no positions in any of the stocks mentioned.This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV