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With Disney parks and resorts closed around the world due to the ongoing COVID-19 pandemic, and cinemas across the country sharing the same fate, conglomerate revenues have been severely compromised, leaving a margin temporary maneuver to companies like Netflix, which focus on “staying at home” like video streaming, to gain a financial advantage. In fact, just this Wednesday, Netflix had officially surpassed Disney in terms of value, with the company’s shares reaching an all-time high at the close of the market. However, the mouse is back, with Disney shares rising 4.5% today, closing at $ 106.63 per share. The prospect of a gradual reopening seems to have restored shareholder confidence in the company after initial damage from the ongoing health crisis, bringing Disney’s market capitalization to more than $ 192 billion.
The White House yesterday released new federal guidelines for the “Open America Again” effort, listing the three phases that each state will eventually go through before completing phase 3, which would be considered life after a vaccine. COVID-19 or at the very least a complete abandonment in the cases. In our analysis of the new guidelines, it was not before the state entered phase two that we imagined that the parks could really reopen, with non-essential travel resuming at that time, and only moderate social distancing required. You can read our full analysis of the new guidelines here.
It was shortly after the announcement that Netflix ended its brief two-day stint at the top of the entertainment market.
While these new guidelines certainly pave the way for potential reopening, that doesn’t necessarily mean it will happen anytime soon. BMO Capital analyst Dan Salmon said he does not expect Disney theme parks to reopen before July 1. (The first state can begin to progress in the phases described above on May 1.) Whatever their market value, Disney is the battle remains an uphill battle, as the company has accumulated $ 13 billion in debt and credit contracts to mitigate the financial effects of closing its parks and movie studios.
Source: Variety | Featured Image: Matthew Cooper Photography