If you’ve been an investor in Disney over the past decade, you’ve experienced a roller coaster ride. The late 2010s saw the stock appreciate steadily from roughly $76 per share to more than $145. That momentum continued through the beginning of the COVID-19 pandemic, but it has been a rough ride of poor earnings and lackluster stock price since then.
So what does it mean for investors who have held firm through all that? Keep reading as we dig into how much a $1,000 investment in Disney in 2014 would be worth today. We’ll also look at where the stock could go over the next several years.
Are Disney parks the “biggest rip-off in America”?
What Would a $1,000 Disney Investment Be Worth Today?
As Disney’s stock took a nosedive in 2022 (minus-43.9%), many ran for the exits. However, if you decided to hold, you could have realized a nice gain on your initial investment.
Based on data from Morningstar, $1,000 invested in Disney stock on Jan. 31, 2014, would have been worth $1,442 on Jan. 1, 2024, according to Tommy Thompson, CFP at Innovative Financial Group. “This assumes that all dividends were reinvested, no taxes deducted and no brokerage fees paid.”
The close on Feb. 28, 2014, was $80.81. The close on Feb. 28, 2024, was $110.81 — a gain of over 37% across 10 years. On a $1,000 investment, that would be an unrealized gain of $371.24.
By comparison, the S&P 500 is up 273% over the past decade. It closed at $1,859.45 on Feb. 28, 2014, and finished at $5,069.76 on Feb. 28, 2024.
What Has Been Affecting Disney’s Stock Price?
There were positive signs when Disney reported fiscal first-quarter earnings results earlier this month. Revenue came in flat versus a year ago at $23.55 billion. However, the company exceeded expectations in terms of earnings per share. Wall Street analysts had expected $0.99 per share, but Disney reported a surprising $1.22 per share. This big jump in earnings was partially due to CEO Bob Iger’s 2023 objective to trim expenses, which has been effective faster than the company expected.
On theearnings call Disney said it expects fiscal year earnings to improve by 20% to $4.60 per share, with free cash flow to be in the ballpark of $8 billion. Even streaming, an area of the business where Disney has felt some recent pain, should show a profit later this year, the company forecast.
This news resulted in shares trading higher by more than 10%. Since the earning report a couple of weeks ago, the stock has been trading sideways to slightly lower, but there are signs that Disney investors should be optimistic for the rest of the year.
Where Could Disney’s Stock Price Be Heading?
“In the short term, all three of Disney’s segments are likely to positively contribute to its bottom line due to strong demand for its intellectual property offerings,” said Adam Koprucki, founder of Real World Investor.
With Iger back at the helm, you can expect more bold moves to turn around the beloved company. Earlier this month, the company announced it had agreed to purchase video game maker Epic Games. Having control of Fortnite isn’t exactly a bad thing. Over the next couple of years, the plan is to build Disney Universe, which will be Disney’s first effort at gaming.
Plus, starting on March 15, Disney will have the exclusive rights to Taylor Swift’s Eras Tour. The Disney showing will feature four songs not heard while the movie was in theaters. Given the wild success of Swift, this could be huge for Disney in terms of revenue and continuing to grow its subscriber base.
Disney also recently announced a partnership with Fox and Warner Bros. Discovery to launch a new video streaming platform to stream combined sports content. This platform will host events from most major professional and college sports, including college football, MLB, NFL, NBA, WNBA, NHL, NASCAR, PGA Tour, UFC, Tennis, FIFA World Cup and more.
Disney is also expected to start cracking down on password sharing sometime in 2024. Similar to its effect on Netflix, this should lead to increased revenue and subscribers.
As Disney continues to focus on cost-cutting efforts and launch each of these new initiatives, there could be a positive reaction in the stock price.
The Bottom Line
If you invested $1,000 in Disney stock a decade ago, you’ve seen your share of ups and downs. While your investment has grown over that time, it has lagged against the broad market. However, with Iger back at the helm, Disney is leading a charge to cut costs and bring in new revenue opportunities. Only time will tell whether its efforts will be a fairy tale story.
More From GOBankingRates
- 7 Best New Dollar Tree Items That Are Worth Every Penny
- Average Cost of Groceries Per Month: How Much Should You Be Spending?
- 7 Things to Do With Your Savings in 2024 to Grow Your Wealth
- 4 Reasons You Should Be Getting Your Paycheck Early, According to An Expert
This article originally appeared on GOBankingRates.com: If You Invested $1,000 in Disney Stock in 2014, What Would It Be Worth Today?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
