Netflix And Disney Stock Soar In 2020
The global coronavirus pandemic upended the way the film and entertainment industry conducted its business, leaving a lot of financial disaster in its wake. But even in the midst of all the uncertainty, companies like Netflix and Disney were still able to weather the storm.
The Hollywood Reporter says stocks of entertainment giants like Netflix and Disney end 2020 on a positive note, which is a stark difference from the state of cinema stocks, which took a pummeling because of theater closures brought about by coronavirus-induced lockdowns.
According to the publication, the 86.8 million subscribers that streaming service Disney+ managed to acquire in the space of a year has resulted in the Walt Disney Co. becoming a “Wall Street darling” as it ended up having the biggest gains on the market.
Aside from Netflix and Disney, The Hollywood Reporter says music streamer Spotify and device maker Roku also enjoyed a bump in their stock, especially as more and more countries around the world are enforcing stay-at-home orders because of the global coronavirus pandemic.
Investor’s Business Daily says the success of video and music streaming services does not bode well for more traditional mediums like cable and satellite television. According to the outlet, television providers in the United States lost 3.75 million subscribers during the course of 2020.
Rather than cable television, the leading video subscription service in the United States is Netflix, with Amazon Prime Video following close behind. The other streaming services in the top five are all from Disney -- ESPN+, Disney+And Hulu.
The great year-end performance for Netflix is certainly a turnaround from a couple of months ago when its stocks fell because the company missed subscriber and earnings targets.
Back in October, the streaming giant only managed to add 2.2 million new paid subscribers, short of the projected target of 2.5 million new subscribers. The third quarter earnings per share were also only at $1.74 and not the expected $2.13.
Because of the lower numbers, Netflix stock dropped by as much as six percent during after-hours trading. Nevertheless, Netflix assured subscribers that the drop in growth was not a surprise as most of the growth the company experienced at the start of the year was fueled by lockdowns brought about by the global coronavirus pandemic.
Meanwhile, Disney+ crossing the 80 million mark in subscribers have resulted in financial analysts to rethink their forecasts of the streaming service. Disney had intended to get 90 million subscribers within five years, and now they are close to achieving that in just the space of a year.