New Trade for August 10th 2020

Last week the S&P 500 chugged higher to reach its second-highest weekly close ever.  Futures are pointing to a flat open this morning as the markets try to form a case to build on last week’s gains despite failure by congress to reach a decision on another stimulus package.  Over the weekend President Trump signed several executive orders aimed at extending federal aid, offsetting the dismay over Congress’ failure.   

Much uncertainty remains about how long the COVID-19 pandemic will impact the economy.  Particularly businesses that hinge on travel and in-person entertainment.

Is now the time to shop these severely beaten down companies?  

Investors who are confident about vaccine developments and an economic recovery are choosing their positions now for stocks that could skyrocket on as positive news emerges.  Discernment is key when choosing which of these depleted stocks to invest in.  Today we are highlighting an iconic California based company that is set to flourish as the recovery gains steam.       

Buying Disney (DIS) stock at the current reduced price could be a great way to set yourself for some strong returns once the pandemic and its consequences subside.  The company reported its third-quarter results on August fourth.  For the three-month period Disney incurred a loss of $4.7 billion.  Revenue was just 58% of what the company reported in the prior year period.  Revenue from Disney parks, experiences and product segment declined by 85% from the prior year period. 

Disney+, its streaming service that launched in November of 2019, continues to be the bright spot in the story.  In Q3 there were 57.5 million paid subscribers, which is up an incredible 72% from the second quarter.  

Despite the risk, Disney is not a brand to bet against.  The company has long proven it can create and deliver quality content that consumers love.  Those looking for a long-term coronavirus recovery gainer should look no further.