NEW YORK (TheStreet) -- The Walt Disney Co. (DIS) is said to be considering a plan to invest $1 billion in its Anaheim, CA.-based Disneyland resort in exchange for extending a deal with the city that protects the company from an entertainment tax, Bloomberg reports.
Disney would have until the end of 2024 to use the investment money to create new attractions at the theme park and make road improvements that would improve local traffic flow, the city of Anaheim said in a statement on its website.
The current deal between Disney and Anaheim began in 1996 and is to be replaced by a new deal that would run 30 years.
The proposal is to be considered at the city council's July 7 meeting. The company would be granted a tax relief for another 15 years following an "additional, substantial investment by Disney beyond the $1 billion," the city said in a statement.
Shares of Disney are up by 0.31% to $114.80 in late morning trading on Friday morning.
Separately, TheStreet Ratings team rates DISNEY (WALT) CO as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate DISNEY (WALT) CO (DIS) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, notable return on equity and good cash flow from operations. We feel its strengths outweigh the fact that the company shows low profit margins."