Forget Disney, Buy These 2 Entertainment Stocks Instead
StockNews
Published Dec 02, 2021 08:55AM ET
Updated Dec 02, 2021 09:31AM ET
Forget Disney, Buy These 2 Entertainment Stocks Instead
Even though the entertainment industry is expected to grow significantly in the coming months, the streaming services space has become overcrowded. So, not all industry participants are well-positioned to gain in the near term. For instance, we think the stock of famous entertainment company Walt Disney (DIS) looks overvalued at its current price level. Therefore, it could be wise to bet on quality entertainment stocks News Corporation (NWSA) and World Wrestling Entertainment (NYSE:WWE) instead to capitalize on the industry’s growth. Read on.One of the world’s premier entertainment companies, The Walt Disney Company (NYSE:DIS), in Burbank, Calif., has completed several developments over the past few months, especially with the help of its streaming service Disney +. However, its shares plunged in price after it posted fourth-quarter earnings that missed Wall Street’s expectations and revealed a significant slowdown for its Disney + service.
Also, on November 16, Louis Alfieri, the chief creative officer of Raven (NASDAQ:RAVN) Sun Creative, said that he’s seeking unspecified damages from Walt Disney Parks and Resorts for allegedly infringing on his patent for a “tower ride.” DIS stock has lost 16.5% in price over the past month to close the last trading session at $142.15. Also, in terms of forward EV/S, its 3.82x is 54% higher than the 2.48x industry average. And its 3.09x forward P/S is 86.5% higher than the 1.66x industry average. So, we think it could be wise to wait for a better entry point in the stock.
Nevertheless, the entertainment industry is expected to grow significantly in the coming months, thanks to the increased demand for digital services. Furthermore, as the economy gradually recovers, live entertainment is expected to pick up. According to a PwC report, the $2 trillion-plus global entertainment and media industry is likely to grow 6.7% in 2022. So, we think it could be wise to bet on quality entertainment stocks News Corporation (NWSA) and World Wrestling Entertainment, Inc. (WWE) instead.
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