A Media Giant With Trophy Assets Is on Sale

Regular readers should be familiar with the phrase "Global Elite"...

These companies are the biggest and best in their industries. They dominate the competition.

They have fortress-like balance sheets – and their brands and businesses are well-known all around the world.

Because of their position, these stocks usually command premiums in the market, making them more expensive than most stocks. But when they sell off, we take note. And when they sell off by more than 25%, we really get interested.

We're seeing that play out today...

Disney (NYSE: DIS) was one of the first companies we highlighted in Stock of the Week in November 2018. The company is a $182 billion media and film giant.

Through acquisitions, it now has three world-class movie studios: Pixar, Marvel, and Lucasfilm. These franchises helped Disney create seven of the top 10 highest-grossing films in 2019.

Of course, that's not all it does.

Disney also owns some of the most popular vacation and tourist destinations on the planet. In 2018, it had the top four most-visited parks in the world. And overall, it had eight of the top 10 most-visited parks in the world.

At Stansberry Research, we consider assets that are impossible for other companies to replicate to be "Trophy Assets." They give a company a huge advantage over the competition. That's exactly what we see with Disney's parks and studios.

To take advantage of this content portfolio, Disney launched its Disney+ streaming service in November.

Subscribers can watch everything Disney has to offer on the service. This includes some of the world's best-known franchises –like the Pixar, Marvel, and Lucasfilms acquisitions mentioned above, as well as popular TV series like The Simpsons. And, of course, Disney+ also has the company's "classic" films.

You can't get this content anywhere else. Disney did not renew content licenses with Netflix (NFLX), effectively removing its content from the now-rival platform. This means that people will need to subscribe to Disney+ to see these world-class movie franchises.

The service is already seeing heavy demand...

Last week, Disney reported that Disney+ has passed 50 million worldwide subscribers. It already has 8 million subscribers in India, where it launched earlier this month. And it also launched in the U.K., France, and Spain in recent weeks.

This is a massive jump. In February, Disney reported that it had 28.6 million subscribers. So in a little over two months, Disney+ has nearly doubled its customers.

When it launched in November, Disney said it expected the service would attract between 60 million to 90 million subscribers by 2024.

It has almost reached that goal in less than six months.

The streaming service has exceeded expectations, including Disney's. This should remain a tailwind for DIS shares for years to come.

These strengths don't mean Disney is immune to the recent market sell-off. Shares fell more than 40% from their November high on coronavirus fears to their March 23 low. The company had to shut down its parks to stop the virus from spreading.

However, all streaming services are likely seeing increased usage and subscriber gains because of mass quarantining and stay-at-home orders. In the U.S. alone, more than 90% of the population is under some sort of shelter-in-place order. With people confined to their homes, they are turning to these streaming services to pass the time.

Just look at where Disney recently launched Disney+... The U.K., France, and Spain are all coronavirus hotspots in Europe. And the U.S. has the most coronavirus cases out of any country in the world. These countries are likely playing a huge part in the growth of Disney+.

Disney shares have already begun to rebound. The stock is up 22% from its March 23 low. But it's still about 31% below its all-time high.

Disney has been a longtime member of Stansberry Research's Global Elite monitor, which gives data on the dominant brands and companies from around the world. It has "Trophy Assets" in its theme parks and boasts some of the most recognizable content out there. And now, its rapidly growing streaming service is giving Disney another way to take advantage of its world-class content.