The results of Walt Disney Co’s (NYSE:DIS) most recent earnings show that it is a conglomerate whose largest business, Media Networks, is struggling and faces many headwinds and uncertainties.

Need more fodder to worry over? The revenue of another one of its businesses, Studio Entertainment, fell year-over-year. Movies are an inherently uncertain business, and conglomerates and uncertainty are two things that Wall Street doesn’t like, so investors should avoid Disney and sell DIS stock.

ESPN Drags DIS Stock Results

There’s no question that Disney’s Media Networks business is struggling. The operating income of its Cable Networks unit fell 3% year-over-year to $1.8 billion. Cable Networks accounts for the lion’s share of the company’s profits, as Disney’s entire net income for the quarter came in at $2.4 billion.

ESPN caused most of Cable Networks’ difficulties. The network was hit by a combination of higher programming costs and continued subscriber losses. According to Fortune, ESPN has lost about 10 million subscribers since 2013.

Given the continued proliferation of internet TV options and skinny bundles, chances are good that the trend will continue. And, despite a laundry list of internet video and skinny bundle platforms that will include content from ESPN, which was recited by DIS stock CEO Bob Iger on the company’s earnings conference call, the trend could very well greatly intensify.

As analyst Michael B. Nathanson of MoffettNathanson LLC pointed out during the call, “people are not tuning into SportsCenter the way maybe they used to in a pre-digital world.”

Indeed, in an age in which people increasingly can very easily watch video highlights from any team’s games on many devices, why would they watch ESPN’s highlight shows, which include game footage and news stories they don’t care about? And if ESPN’s highlight shows are increasingly useless, many consumers will not hesitate to buy skinny bundles that don’t include the channel. Additionally, ESPN’s decision to let some of its on-air talent go may increase the uncertainty facing the channel.

Meanwhile, movies, which accounted for another $2 billion of Disney’s revenue, are an inherently uncertain business. For example, DIS is currently working on four Star Wars movies. People who were actually around for the release of the original Star Wars movie are not really in the right demographic to run out and see four  more movies from the series, and many younger people — i.e. their kids — may not be as attached to the series. So once the novelty wears off, attendance might very well start to dwindle.

Not to mention, what happens if, say, Star Wars: The Last Jedi (scheduled for December 2017 release) turns out to be a dud? What will that do to attendance for the movies that follow?

In other words, don’t you think it’s entirely possible DIS stock might lose money an upcoming Star Wars movie?

There’s no doubt that Disney’s Parks and Resorts business is hitting on all cylinders. Launching a theme park in China was obviously a great idea, as Iger noted that “the resort has become a true national destination in China, attendance is outpacing our most optimistic projections and the park’s performance is exceeding our expectations.” The unit’s overall revenue jumped 9% to $4.3 billion and its operating income surged 20% to $750 million. But the business accounts for only a third of the company’s revenue and less than 20% of its operating income.

Bottom Line for Disney

For the foreseeable future, DIS stock will be weighed down by the headwinds and uncertainty facing its media business in the age of internet TV. Disney stock will also be hurt by the inherent uncertainty of its movies unit. Meanwhile, Disney stock, trading at a forward price-to-earnings ratio of over 16, is not exactly cheap.

The growth of the Parks and Resorts unit could explode and its movies could be runaway hits and the stock could rise significantly. Or Disney could push its stock higher by somehow finding a way to stop ESPN’s subscriber losses.

But it’s more likely that Disney stock will continue to underperform as ESPN continues to struggle and investors recoil from all of the uncertainty posed by the conglomerate.

As of this writing, Larry Ramer did not hold a position in any of the aforementioned securities.