Walt Disney has arguably been the most reliable stocks on the market for quite some time. However, over the past month and a half, the stock has been declining as widespread market declines show no favorites. With economic conditions around the world hurting, Disney needs to do something to get visitors into their theme parks during the off season. As a result, the company is mulling around the idea of changing its pricing structure and investors seem to love the idea. Today, we’ll talk about the new pricing structure Disney is considering, how the market reacted to the news, and how to take advantage of the trends we can expect from the stock moving forward.
Disney’s Idea Of A New Pricing Structure
Disney has noticed a key problem with their theme parks, Disney World and Disneyland. The major problem they’re having is that during big seasons, they’re seeing large amounts of visitors. However, during the off season, their theme parks are ghost lands. The company plans to change this, and I think that if they follow through with their plans, it will work incredibly well. The new plan is to change pricing to a tiered structure, depending of course on the time of the year that visitors want to visit their theme parks. The company is in the process of beginning a survey of previous visitors this week. The results of the survey will help Disney decide whether or not the tiered pricing structure is a good idea. In a statement, Walt Disney Parks and Resorts Chairman, Bob Chapek had the following to say…
“We have to look at ways to spread out our attendance throughout the year so we can accommodate demand and avoid bursting at the seams…”
How The Market Reacted To The News
In general, when positive changes are announced with regard to a publicly traded company, we tend to see positive reactions in the market. While the tier-based pricing at Disney theme parks is just an idea and not yet in full swing, the market has reacted in an overwhelmingly positive way. In today’s trading session, Walt Disney shares closed at $103.84 per share after a gain of 0.82%.
What We Can Expect To See Moving Forward
As mentioned in the beginning of this article, Disney has always been a very reliable stock choice. With that said, market declines are going to happen here and there. Even though Disney has been down over the past month and a half, I’m not expecting for this trend to continue. Not to mention, with the new tiered pricing structure becoming a possibility, investors are becoming excited about the stock again. With all things considered, I’m expecting to great things from Disney moving forward.
How To Take Advantage Of The Trends
In the case of Disney, there’s no doubt in my mind that this stock is going up. The only question here is “When will the stock go up?” With that said, the best way to take advantage of the trend here is to look for call option opportunities. However, instead of simply thinking about short term trades, think about long term trades as well. In today’s volatile market, it can be hard to determine where a stock is going to go in 5 minutes. However, over the course of 30 days, it’s all but guaranteed that Disney is headed upward!
What Do You Think?
Where do you think Disney is headed and why? Let us know in the comments below!
[Image Courtesy of Fox 13]