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 Disney News, Disney World News |
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Last Updated: Apr 21, 2009 - 9:08:32 AM
By wdwinfo.com
Oct 8, 2008
Following Merrill Lynch Analyst Jessica Reif Cohen's downgrading of Disney's stock, the company closed at $26.57 for the day, a 6% decline.
While Reif Cohen acknowledges Disney has "the highest quality name" and does expect the company to have an overall increase for this fiscal year, she cautions that "this could be the calm before the storm."
There are concerns that Disney will see a flattening in operating income in 2009 due to the current economy. Reif Cohen stated "rising unemployment will be the straw that breaks the camel's back. We are hard pressed to believe that attendance will not fall in fiscal 2009. People who don't have jobs simply do not go to Disney World."
Disney has long been considered the leading stock in the large entertainment company category. With its reliance on consumer products and advertising, as much as 60% of its revenue is considered vulnerable due to the change in the economy.
Reif Cohen commented "we think there is significant risk to the stock in the coming months."
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