Markets
DIS

Does Disney's Investment in Jaunt Imply a Future Buyout?

As per recent market buzz, media behemoth The Walt Disney CompanyDIS , along with Evolution Media Capital, China Media Capital, Axel Springer, and Madison Square Garden Co MSG, is all planning to invest $65 million in Jaunt, a virtual-reality ("VR") production and technology start-up company.

Jaunt is engaged in developing technology that provides end-to-end solution for developing cinematic virtual-reality experiences. Jaunt is known for bringing live-action shows, movies, and sports to virtual reality through its headsets, capturing multiple vantage points while shooting concerts and movies. Viewers, watching these videos on screens inside virtual reality headsets, will feel as if they are an integral part of the event or show.

This is a huge step for Jaunt, whose total funding has now increased to roughly $100 million. This new investment gives the start-up enough money to improve its cameras, boost production on all fronts, and increase software development. Previously, Jaunt had to compromise on its picture quality. However, to handle computational load the company intends to have new cameras by next year. Jaunt also plans to hire more employees in both its Palo Alto, CA headquarters and its brand new studio in Los Angeles.

Will Disney Buy Jaunt in the future?

Although Disney is a global business giant, it is more prominently known as a media conglomerate. Sure its theme parks are hugely popular, but its influence on the world of television, music, film, and radio is staggering.

We believe there is a fair chance of Disney acquiring Jaunt in the future given the latter's significant impact on movies, sports and music where VR content in becoming increasingly popular.

The demand for virtual reality headsets is on the rise with expectations of several headsets being shipped in the next six months. According to Juniper Research, an industry research firm, 3 million virtual reality headsets will be shipped globally in 2016. The figure is expected to touch 30 million in 2020. This indicates that the future of virtual reality start-ups is bright.

Disney's investment in Jaunt places it in competition with Facebook, Inc. FB , which acquired Oculus VR in 2014, and Google Inc. GOOG , which has developed its very own virtual reality headset that works with Android smartphone Google Cardboard.

Zacks Rank

Disney currently has a Zacks rank #3 (Hold). A better-ranked stock in this sector is World Wrestling Entertainment Inc. WWE , which holds a Zacks rank #2 (Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days . Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

WORLD WRESTLING (WWE): Free Stock Analysis Report

DISNEY WALT (DIS): Free Stock Analysis Report

FACEBOOK INC-A (FB): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

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


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

In This Story

DIS FB GOOG WWE

Other Topics

Stocks