Instant Analysis: Investors Yawn As Disney Sets Another Record


Dory with her childhood best friend, Destiny the whale shark. Image source: Disney Pixar.

Barely a week after Walt Disney 's(NYSE: DIS) studios earned the honor of being the fastest in history to earn $5 billion at the worldwide box office, Finding Dory set the all-time record for U.S. grosses for an animated movie.

Less than five weeks into its release, Finding Dory came into Monday having earned $445.5 million at the U.S. box office. That tops DreamWorks Animation 's Shrek 2 , which moves to second at $441.2 million in U.S. earnings. Disney's The Lion King ranks third on the all-time list, with $422.8 million in domestic grosses.

As impressive as Dory 's performance has been, it's no outlier. Disney brands have been winning at the box office all year . According to Box Office Mojo, films distributed by the House of Mouse have accounted for 31.3% of domestic receipts through July 17. And that's just for 10 films. Second-ranked Twenty-First Century Fox (NASDAQ: FOXA) has distributed 14 movies, accounting for 16.5% of receipts, while third-place Time Warner (NYSE: TWX) has distributed 22 movies, accounting for an even 14% of the U.S. box office.

Impact Meter

Does it matter?

Investors should think more of this. Instead, Disney stock is down about 4.6% year to date. The benchmark S&P 500 index is up more than 6% over the same period, which seems grossly unfair.

Consider recent history. Last year, operating profit for Disney's Studio Entertainment business zoomed 45.1% on a 40.9% jump in domestic box-office receipts. As of this writing, Box Office Mojo has Disney tracking 63.5% ahead of its 2015 total .

With Marvel's latest, Doctor Strange , due in November and Rogue One: A Star Wars Story due just a month later, it's reasonable to think the Mouse can keep up with history and grow its 2016 Studio Entertainment operating income by 60% or more -- just the sort of news that should be pushing Disney stock higher than it trades for today.

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Tim Beyers owns shares of Time Warner and Walt Disney. and has the following options: long January 2017 $85 calls on Walt Disney. The Motley Fool owns shares of and recommends Time Warner and Walt Disney. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance , Stocks
Referenced Symbols: DIS , FOXA

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