NEWS: Walt Disney Company Stocks Fall Again After Analyst Says Parks May Not Reopen Until 2021

With the current global health crisis affecting the Walt Disney Company across a variety of different sectors, the company’s stock price has been on the decline.

©Disney

While last week the price crept up slightly due to the surge in popularity for the Disney+ streaming service, today saw the Walt Disney Company stock down again

According to Barron’s, Disney’s stock shares fell 1.8% today, April 20th, after UBS analyst John Hodulik “downgraded the stock ahead of the entertainment company’s first-quarter earnings report scheduled in early May.” The downgraded stock came the day after Disney officially furloughed over 100,000 employees.

It’s notable that, in Hodulik’s report, he “assumes the parks will stay closed until the start of 2021.” His assumption comes in opposition to many other Wall Street analysts, who still expect “a summer reopening of the theme parks.”

Hodulik wrote that, “While officials at the federal and state level are working on ‘opening’ the economy, we expect it to happen in stages, with stadiums and theme parks low on the list.” He continued by noting California Governor Gavin Newsom’s recent remarks that the prospect of mass gatherings would be “negligible at best until we get head community and we get to a vaccine.”

Hodulik also expects that attendance will be markedly lower, with expectations for attendance to reach “50% of 2019 levels” prior to climbing back to “75% in the second half of 2021.”

Even when Disney reopens its parks, Hodulik expects attendance to be 50% of 2019 levels and climb back to 75% in the second half of 2021. “[T]he economic recession plus the need for social distancing, new health precautions, the lack of travel and crowd aversion are likely to make this business less profitable until there is a widely available vaccine,” Hodulik wrote. “We now believe the profitability of the theme parks will be more profoundly affected over a longer duration than previously expected.”

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