‘Tiger King’ beats ‘Lion King’: Netflix widens market cap lead over Disney
Based on how Netflix Inc. and Walt Disney Co. trade, Wall Street is more into “Tiger King” than “The Lion King.”
With the pandemic keeping audiences indoors, streaming video has become the go-to entertainment option, especially as theme parks and cinemas remain largely closed. As a result, Netflix’s market capitalization has eclipsed that of Disney to an historic degree.
Currently, the platform that made a must-see TV documentary about big cat breeding has a market value of around US $ 250 billion, compared to US $ 216 billion for Mickey Mouse House. and Simba the lion. This gap in favor of Netflix is the highest on record, according to a Bloomberg analysis. When expressed as a ratio, the degree to which Netflix is greater is also at an all time high.
While the two companies have repeatedly reversed in terms of sizing this year, the recent change has been rapid; Disney’s market capitalization exceeded that of Netflix as recently as the end of June.
Shares of Netflix have risen more than 75% so far this year, compared to a 17% drop for Disney. The divergence is almost entirely due to the pandemic, which has put pressure on Disney in all of its activities. Theme parks have been closed for months, and the company has delayed the release of films like “Mulan” and “Black Widow”. Previously, MKM Partners wrote that the outlook for theaters remains “extremely clouded given the uncertainty over when theaters can reopen with new Hollywood content.”
Netflix, meanwhile, is expected to see much higher engagement and subscriber growth when it releases second quarter results later this week. Analysts are increasingly optimistic about the company. Last week, Goldman Sachs wrote that the pandemic was “speeding up the shift” to streaming content, away from traditional television, and that the company’s content library and distribution “would serve to sharpen Netflix’s growth curve. both short and long term ”.
Disney’s own streaming service has been a bright spot in recent months, especially with the recent debut of “Hamilton”. However, the company’s Parks, Experiences and Products business is much larger, accounting for nearly 37% of its 2019 revenue, according to data compiled by Bloomberg.