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No. of Recommendations: 26
I voted yes to the mouse -- I've spent a little time over the last couple of days on DIS.

As Captainccs pointed out, there are some things to like right now:

1. EPS over the last five years has gone from .60 to 2.20 while the stock price has remained pretty flat. Income and cash flow are trending up also.
2. Dividends are up and DIS is among the top 3 in the DJIA for Net Payout Ratio (Dividends + Stock Buybacks - Stock Issuances). Strong value signal.
3. The company passes the 9-step Piotrowski test stated by TMFCop in his 2004 post #1092. This value screen was recommended as part of DD to help avoid beaten down companies that may go bankrupt. I'm not concerned about the mouse going down for the count, but I'm still working on a framework for my DD.

Last year when DIS came up, captainccs brought out some very important points in post #19188. In looking at the 30 year chart, he noted three major periods of price movement:

1. From the beginning of the chart to ~1984
2. ~1985 - 2000
3. 2002 - Present

Then he asked several good questions, pointing out that real DD in the BMW world is to come up with explanations for the chart's appearance. So here goes.

The first period roughly corresponds to Roy Disney's leadership. Roy took over the company after Walt's death and led it in the '70's.

The second period strongly coincides with Eisner and Well's time at the helm. DIS's low stock price in the early '80's brought on several hostile takeover attempts, and Eisner ended up in charge.

During his tenure, DIS was a dynamic company that opened new parks (Euro Tokyo, Animal Kingdom, etc), expanded old ones, led all movie houses in box office take ('88), and broke ground through its partnership with Pixar into computer animation. Also, this period corresponds with a large portion of the great bull market in the '80's and '90's, so it's possible a significant portion of the results here reflect the equity environment of the period.

The final period includes the tenure of the "new" boss Iger. He came on board in 2005 and this period includes the purchase of Pixar. His first full year brought record cash flow and income.

While I think I found reasons to explain the first two periods of price performance, I don't think I've stumbled onto the reason for the flat chart from 2002 to the present. Perhaps a part of this also derives from broader market conditions over this period.

Any ideas????

Even with this question still open, the power of the mouse is pretty persuasive. I would especially like this stock around $27.00 -- the -2.00 RMS point on the 35-year chart.

Comments and questions please -- this is my first attempt at meaningful DD on a stock.

stuart
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