馃彴 WALT DISNEY COMPANY: DERIVATIVES TRADING 馃彴
The Walt Disney Company [NYSE: DIS], together with its subsidiaries, operates as an entertainment company worldwide. It operates through two segments, Disney Media and Entertainment Distribution; and Disney Parks, Experiences and Products. DIS belongs to Communications Services sector and Entertainment industry. An insight about it is:
Pros:
- It has a strong capital in properties and rights that ensure its survival
- By the moment, the probabilities are acceptable for sector [ https://jjplindex.blogspot.com/2023/07/sp500-probabilities-of-appreciation.html ]
- It could benefit from the metaverse and the future generations to which it appeals.
Cons:
- Ideology anti-woke and empowerment of conservative sectors may be its enemies in short and medium term
- Their margins are declined over the years, and it could be a serious problem
- It seems to have reached its maximum level of business maturity
The current EPS is ± $2.26 USD and a possible PER spread could be:
- PER 25: ± $ 56.5
- PER 35: ± $ 79.1
Levels:
The next support zone is at ± $79 USD and the great support is at ± $70 USD. The next resistances zones are ± $108 USD, ± $126 USD and ± $140 USD. The ± $118 > $126 USD zone is an indifference price, a optimal target could be ± $140 USD and all above ± $175 USD could be highly speculative.
Hedge:
- Call [sell]]: $180 USD
- Cal [buy]: $150 USD
- Call [buy]: $90 USD
- Put [sell]: $70
Risks:
A minor risk is that the price does not exceed $150 USD, but could be compensated with the profit of the Call at $180 USD. The worst risk is the price exceeds $180 USD or that the price will fall severely below $70 USD for much time; for any case, a close position is required. For the case where the stock falls below $70 USD, the investor will need to start an accumulation phase. For the case that the stock exceeds $180 USD, the $270 USD is their last big resistance to short.
The best analysis is yours!
J. Joel Padilla
Copyright: Joel Padilla 2023
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