Apple can take advantage of the Covid-19 season market fluctuations to make the deals they want.
The stock market was engulfed in the red by the Covid-19 pandemic, causing the capitalization of entertainment giants to suffer. Many commentators on Wall Street think that this is a good time for technology companies to “spend money” to acquire famous Hollywood names.
Bernie McTernan, an analyst from Rosenblatt Securities, said Apple, the world’s most valuable technology company, may consider acquiring Disney after its stock fell to $ 100 last week.
McTernan said that with the long-term vision, leaders of companies with financial potential like Apple can take advantage of market volatility to buy Disney. Currently Disney’s market capitalization is US $ 165 billion , while Apple has about US $ 107 billion in cash and stocks.
“The acquisition of Disney will help Apple ensure the strategy of promoting movie service and content delivery by integrating Disney’s ecosystem into the iOS platform,” McTernan said.
Disney’s market capitalization over the past three weeks has dropped by a third to $ 85 billion . If you buy Disney, Apple can take advantage of the Disney + movie service to enhance content for Apple TV +. By the end of 2019, Disney + had 26.5 million registered subscribers, the number as of February 3 was 28.6 million.
In the session ended March 13, Apple’s stock rose 12% to $ 277.97 , while Disney lost 11.7% to $ 102.52 .
In February, Bob Iger resigned as Disney CEO after more than 15 years of working. He remained president of the group until the contract ended in late 2021. The new Disney CEO is Bob Chapek.
Bob Iger served on Apple’s board of directors from November 2011 to September 2019. At Apple, he serves as chairman of the Management Committee and joins the Remuneration Committee. With Apple launching the TV + movie service, Apple and Disney officially became competitors in the online television service, which led Iger to leave Apple’s board of directors.
The outbreak of the Covid-19 epidemic had a significant impact on the entertainment industry when a series of films were postponed, estimated to cost billions of dollars. Besides the movie segment, Disney theme parks around the world have been closed to prevent the virus from spreading. The closing of the park, stopping the launch of the film has made Disney’s stock more than 20% since Bob Chapek became CEO.