Disney bought $2.four billion of its own stock for the duration of industry freakout

5 Spectacular stats about Disney Disney has unleashed the Power — on alone.

When Disney ( DIS ) and other media stocks crumbled last month , the property of Star Wars seized on the opportunity to purchase again its stock at what looked like grime low-cost charges.

Disney went large, aggressively repurchasing $ 2.four billion shares, Thomas Staggs, the company’s main working officer, told analysts at a convention on Thursday.

In August, Disney stock plunged into a bear market — down much more than 20% from modern highs — amid fears that even its vaunted ESPN network was being squeezed by consumers slicing cable.

“The marketplace (gave) us an opportunity to get the inventory at meaningfully lower costs,” Staggs said at Financial institution of America Merrill Lynch’s media conference.

“So we’ve taken huge gain of that prospect,” he said.

It is almost an understatement. Disney’s recent buybacks depict nearly 50 % of the firm’s overall repurchases of $ five.6 billion in this fiscal year.

“We figured they’d be intense, but not this aggressive,” stated David Miller, a media analyst at Topeka Funds Markets.

Cord-slicing freakout overdone?

The buys depict a vote of confidence in the company’s existing technique and a signal that executives believe the negative sentiment received a tiny carried away.

The selloff commenced on August 4 following Disney documented reliable 2nd-quarter benefits, but also disclosed a slowdown in subscriber expansion at ESPN . The news elevated issues that Netflix ( NFLX , Tech30 ) , Amazon ( AMZN , Tech30 ) Key and other rising platforms have sparked an acceleration of twine cutting, ingesting into the cable’s subscriber costs that are essential to media businesses.

The twine-chopping fears sent Disney shares diving nine% the up coming working day. Rivals have been also caught up in the storm, with Discovery Communications ( DISCA ) plummeting twelve% and CNNMoney operator Time Warner ( TWX ) sinking a lot more than eight%.

“I believe the market place overreacted,” Staggs stated.

Is ESPN threatened?

The Disney exec sought to reassure traders about the well being of ESPN, its ratings and subscriber juggernaut.

He pointed to ESPN’s ability to attract viewers on multiple platforms, including ESPN.com, WatchESPN and other applications. ESPN is a money-maker for cable suppliers, driving the most local advertisement product sales, large-definition upgrades and broadband subscriptions, Stagg explained.

“ESPN in specific proceeds to be 1 of the most important and useful brand names in programming,” Staggs mentioned.

Investors cheer buybacks

Disney wasn’t the only 1 jumping on the abruptly-cheap stock.

Exencial Wealth Advisors, which previously owned a good deal of Disney inventory, purchased a lot more throughout the recent selloff, in accordance to David Yepez, an investment decision analyst at the firm.

“When you have great companies like Disney that action in when the stock falls it is excellent for buyers because it sets a ground beneath the price tag,” Yepez stated.

Disney shares on the comeback path

Of training course, Disney has a lot more to it than ESPN and its other cable networks. Excitement continues to create above the Star Wars franchise, as highlighted by last week’s Power Friday function. That is when toys and other goods tied to the “Star Wars: Episode VII — The Pressure Awakens” shift went on sale.

It’s the very first new Star Wars film considering that Disney obtained Lucasfilm in 2012. Disney not too long ago introduced the creation of two “Star Wars” enlargement s at its Disneyland and Disney Globe resorts.

Disney shares continue to rebound from the freak out experienced very last month. They are presently investing at about $ 103, up 31% from their August lows of $ 78.fifty four.

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