Disney Takes Stake In MLB Spinout BAMTech

Overall revenue rose 9% to US$14.3 billion, with the company’s Studio Entertainment division seeing a 40% rise in revenue over past year to the tune of US$2.8 billion. Diluted earnings per share (EPS) for the quarter increased 10% to $1.59 from $1.45 in the prior-year quarter.

Shares of Disney fell about 2 percent in extended trade.

The money will be used to accelerate BAMTech’s video service platform, which already serves 7.5 million paying subscribers at various clients. Higher equity losses from Hulu reflected increased programming, marketing and labor costs, partially offset by higher subscription and advertising revenues. Subscriber at ESPN declined in the reported quarter also.

Iger pointed out that companies which attempted to push a skinny bundle to consumers without ESPN haven’t seen much success. Disney is making its full effort to bring back ESPN’s golden days. In buying a 33 per cent stake in video-streaming firm BAMTech for $1 billion, Disney is hoping to lure online viewers.

As per sources, value of the deal stands at $1 billion.

“W$3 e think Disney has bought its way into a commanding position on future content viewership: BAMTech is a premier OTT [over-the-top] streaming technology in its own right, and Disney now has the means to connect directly with consumers”, Macquarie analysts wrote in a note published Wednesday. It will also collaborate with ESPN to launch and distribute a new ESPN-branded multi-sport subscription streaming service in the future. “All of that incredible Disney content and intellectual property is no longer king; maybe a rook, or a bishop or even a knight, despite the offense Disney’s running”.

Coming back to the results, the company’s total operating income came in at $4,456 million during the quarter, up 8% year over year.

Its theme parks also performed strongly, with operating income of $994 – an 8% increase on a year ago.

Other Hedge Funds, Including, Parkside Financial Bank Trust reduced its stake in DIS by selling 483 shares or 2.99% in the most recent quarter. Revenue at Disney’s theme park division rose 6 percent to $4.38 billion. While domestic operations were robust, worldwide operations were hampered by lower footfall and higher operating costs at Disneyland Paris and also due to higher pre-opening expenses of the Shanghai Disney Resort. Increase in operating income was propelled by rise in home entertainment and theatrical results. Disney Consumer Products (DCP) delivers product experiences across thousands of categories from toys and apparel to books and fine art. Disney Interactive is a creator of interactive entertainment across all current and emerging digital media platforms.

Profit excluding some items rose to $1.62 a share, Burbank-based Disney said Tuesday in a statement.

Currently, Disney carries a Zacks Rank #3 (Hold).

However, if you’re looking for a solid dividend stock, that’s a different story.