Disney loses $2.8 billion amid pandemic but improves forecasts

November 13, 2020 14:00

Disney loses 2.8 billion amid pandemic but improves forecasts

The Walt Disney Company ended its fiscal year with a net attributable loss of $2.864 billion compared to earnings of $11.054 billion the previous year. The mouse company has been hit hard by the coronavirus pandemic by having to close its theme parks for months, as well as many of its stores and cruises, while it has been forced to delay without date the movie premieres that it had planned in 2020. Their income fell 6%.

Despite the red numbers with which it has closed its fiscal year, Disney shares rose 4% in the pre-opening of the market to $135, still far from the $150 it was trading at a year ago. Investors consider it a positive sign that the company has exceeded forecasts for the fourth quarter of the fiscal year in both profits and income.

Daily CFD Disney chart

Source: Admiral Markets MetaTrader 5. Daily CFD Disney chart. Data range: from September 10, 2018, to November 13, 2020. Prepared on November 13, 2020, at 12 noon CET. Keep in mind that past returns do not guarantee future returns.

In the graph we can see the notable fall in the price of Disney shares at the beginning of the coronavirus pandemic (orange rectangle). After hitting the bottom at $86.76 on March 18, it begins to recover little by little, with some ups and downs. Last Monday, November 9, it formed a gap due to the euphoria unleashed in markets on the advances of a vaccine against Covid-19. It fell back in later sessions.

So far, in 2020, it has already lost just over 6% of its value. In the last five years, Disney has only closed 2016 negatively (-0.82%). Last year ended with a cumulative rise of 31%.

The market is also celebrating that in the fourth quarter its Disney+ platform reached 73.7 million subscribers in just one year from its premiere. This figure is 13 million more than last August.

A month ago, Disney announced a reorganization of its business to focus on streaming services and its Disney+ platform with the aim of minimizing damage from Covid-19. In this way, the company will create a division for the development and production of exclusive content for its platform and another for distribution.

If you are interested in investing in Disney, with Admiral Markets UK Ltd you can do so through Contracts for Difference (CFDs), which allow you to speculate on price movements both up and down. Click on the following banner to open a real trading account and start trading:

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