Team Project

Heidi Hyde
Chris Cornelius
James Cholewinski
Rob Maldonado
Shantell Allen
Spencer Watchman

Walt Disney Company

Team Project
Mike Duncan
BUS 1010
November.07, 2014

Walt Disney Company

Imagine a world without Walt Disney, a world without the ability to make dreams
come true. Disney Company has been captivating childrens hearts with all the famous
characters for over nine decades. Walt Disney transformed the entertainment industry,
into what we know today. It all began in the 1920s, when Walt and Roy Disney founded
The Disney Brothers Studios. From this point on the wholesome family entertainment
company, evolved into a leading international entertainment and media enterprise, which
operates five separate Disney segments: Media Networks, Parks and Resorts, the Walt
Disney Studios, Disney Consumer Products and Disney Interactive. Each segment
contributes to the multi -billion dollar success of the company. The Walt Disney
Company can be represented as one of the most thriving companies because of the
underlying analysis of the companys global strategy with key internal and external
factors that impacts the company and sets a competitive advantage.
Looking into the question of how this company is thriving, we need to evaluate
the strengths of the company. One of the major strengths of the Disney Company is their
well-built product portfolio. The product portfolio includes broadcast television network
ABC and cable networks such as Disney Channel and ESPN, which are among the most
watched cable networks in the world.1 The total amount of each audience by network is
astonishing. ESPN has nearly 300 million and Disney Channel 240 million

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.

subscribers.2 These numbers have demonstrated a significant portion of product

portfolio and has proven a competitive advantage for their company to their competitors.
Having a strong product portfolio has led to the companys brand reputation. For more
than 90 years in the United States and worldwide, the Walt Disney brand has been
recognized and known. This company has been seen as the main family entertainment
provider and was the 13th most valuable brand (valued at 27.4 billion) in the world in
2012.3 The business operates five different segments, creating a diversified business.
The companys segments are operated online and offline, in many different economies
and are generating their income using different business models.4 This allows Walt
Disney to be less affected by changes in external environment than their competitors are.
The strongest attribute the company has is its competency acquisitions. The Walt Disney
Company had acquired Pixar Animation Studios in 2006, Marvel Entertainment in 2009
and Lucasfilm in 2012.5The first two acquisitions have already proven to be very
successful in terms of revenue and profit growth. The third acquisition is presumed to be
just as successful. Acquiring the rights to all of the Lucasfilm, created much profit with

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.
3

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.
4

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.

previous films such as Star Wars. There hasnt been any record of Disneys competitors
having such acquisitions.
Although competency in acquisitions adds strength to Disney, it also causes
weakness to the company as well. Being the largest entertainment provider in the world,
Disneys acquisitions had to be approved by Federal Trade Commission. What this
means is that the size of Disneys business has become a concern for the government.
Due to significant market concentration and the company offers few opportunities to
acquire competitors. Otherwise, Disney may become a subject to antitrust laws.6
Operating in a very aggressive and competitive industry, Disney has been targeted by
threats to the company. The threats entail include intense competition, increasing piracy,
strong growth of online TV and online movie renting. Besides containing both weakness
and threats, Walt Disney Company continues to strive to out beat their competitors.
The leading international entertainment and media enterprise is grounded by the
companys one vision. Its mission for all of its business operations. "The mission of The
Walt Disney Company is to be one of the world's leading producers and providers of
entertainment and information. Using our portfolio of brands to differentiate our content,
services and consumer products, we seek to develop the most creative, innovative and
profitable entertainment experiences and related products in the world.7 A company that
honors their mission generates a successful company, and the Walt Disney Company is
proof of that (48.81 billion revenue, price/earnings ration 21.3 and debt to equity ratio

Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis 2013. February 16, 2013. Accessed

November 7, 2014.
7

"Investor Relations | The Walt Disney Company." Investor Relations | The Walt Disney Company. Accessed November

7, 2014.

33.01).Disney has been highly successful at managing its cash flow, returning large
sums of its free cash to shareholders via dividends and share repurchases71.3 million
repurchased shares in fiscal 2013, worth to $4.1 billion, are expected to increase in 2014
and will range between $6 billion and $8 billion in returns.8Despite the possibility of the
economy weakening, the Disney Company still has a range of opportunities of growth.
The increase of paid TV industries in emerging economies and the expansion of movie
production to new countries will continue to strengthen its positions from the high
industry growth. Last year, the dual business model of theme parks and television
networks, have contributed to a steady 40% of revenue growth over the past decade,
leading to a sum of $45 billion in 2013, with a 20.5% operating margin and trading at a
price of a premium merely 14% compared to the industrys average.9 The Walt Disney
Company is headed in the direction that all companies make every effort to lead. The
chairman and CEO of the Walt Disney Company, Robert A. Ihger said recently our
strategy of building strong brand and franchises continues to create value across our
company, this quarter, we delivered the highest EPS in the companys history. Were
extremely pleased with these results.10 Those spoken words scream of a successful
company. The Walt Disney Company today is a company that has a very bright future.

Kehoe, Pato. "GuruFocus Premium Membership." Walt Disney: A Sustainable Business Model. January 14, 2014.

Accessed November 7, 2014.

9

Kehoe, Pato. "GuruFocus Premium Membership." Walt Disney: A Sustainable Business Model. January 14, 2014.

Accessed November 7, 2014.

10

"THE WALT DISNEY COMPANY REPORTS THIRD QUARTER AND NINE MONTH EARNINGS FOR FISCAL 2014."
Http://thewaltdisneycompany.com/sites/default/files/reports/q3-fy14-earnings.pdf. Accessed November 7, 2014.

References

"Investor Relations | The Walt Disney Company." Investor Relations | The Walt
Disney Company. Accessed November 7, 2014.
Jurevicius, Ovidijus. "SWOT Analysis of Walt Disney." Walt Disney SWOT Analysis
2013. February 16, 2013. Accessed November 7, 2014.
Kehoe, Pato. "GuruFocus Premium Membership." Walt Disney: A Sustainable
Business Model. January 14, 2014. Accessed November 7, 2014.
"The Walt Disney Company." The Walt Disney Company. Accessed November 7,
2014.
"THE WALT DISNEY COMPANY REPORTS THIRD QUARTER AND NINE MONTH
EARNINGS FOR FISCAL 2014."
Http://thewaltdisneycompany.com/sites/default/files/reports/q3-fy14-earnings.pdf.
Accessed November 7, 2014.