Margate Capital Management has invested in Walt Disney Co (NYSE:DIS). Despite the significant problems that the entertainment giant is currently facing. One of the main problems regarding investors being worried about their ESPN channel. Due to this, the stocks have plummeted around dropping from $115 to $99 a share on Monday. However, this may all change with one of the top industry hedge funds interest in the media entertainment giant.
The reason Margate Capital Management has invested in Disney
The main problem that Disney currently faces, is regarding its ESPN channel. However, Greenberg is adamantly stating that these views on the channel failing are unfounded. The specific fear is that ESPN will not be able to contend with other streaming packages.
However, from the information that Greenberg released, it was clear that their view was the opposite perspective. Currently, ESPN is responsible for almost a quarter of Disney’s EBITDA. This means that the impact that ESPN can have on Disney, in worst case scenario, will be limited.
Furthermore, ESPN has been integrated, with a secure partnership agreement, with almost all current streaming platforms. Including the likes of both Hulu, and YouTube. All of this was disclosed during the presentation of Greenberg.
How this investment would aid Disney
According to the presentation done by Greenberg, their investment could be the triumph card for Disney. From the analysis of the company, it was reported that Disney may witness a stock rise of up to $147.
This is due to the fact that it would become a stronger standalone. This predicted stock price is almost 50 percent higher than the current market stock price.
There was no performance data released upon the completion of the investment. However, it was revealed that Margate Capital Mangement has invested in Disney, with a sum of $200 million already. Furthermore, it was revealed that this investment was initiated on October, 1.
Disney stocks closed on Monday at $98.97 after settling at $0.15 or 0.15 %
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