The Walt Disney Company’s (NYSE:DIS) media and entertainment segment has resumed its robust growth during the first few days of April as it once again topped the weekly movie streaming charts with Encanto. DIS also experienced streaming success with Free Guy and West Side Story, ranking third and seventh on the charts. I think it is likely that Disney will sustain its impressive results for the foreseeable future, thus making it a desirable investment. Here is why.
Much of the entertainment giant’s streaming success has to do with its aggressive investment in data and analytics tools. This allows it to improve its firm-wide efficiency. Rita Ferro, The firm’s president of advertising and sales, stated last month that “The commitments we shared one year ago, are being activated upon today. Not only are we announcing new advancements at our second annual Tech & Data Showcase, we’re showing and proving how we’re delivering on our promises to clients.” She also added that “Disney’s investment in data, technology and automation is an ever-evolving journey, resulting in enriched, transactable outcomes along the way.”
Disney has been able to proliferate its financial success by integrating artificial intelligence into its business model, which has improved its forecasting of target markets, consumer demand, and input costs.
In other positive news, the company beat its first-quarter earnings estimates by 43 cents per share. The key driver behind its quarterly success was an 11.8 million increase in Disney+ subscribers. This makes its total tally of subscribers 196.8 million.
DIS stock could experience staggering medium-term growth, with its earnings per share expected to surge by 40.21% over the coming year. Additionally, the company’s expected earnings per share growth means that DIS has a price-to-earnings-growth ratio of 0.77. This indicates that the stock market hasn’t taken note of the firm’s earning potential just yet.
Disney stock is very investable at the moment. Its enhanced data analytics means that we’re likely to see the company’s earnings grow exponentially in the medium-term. Thus, DIS stock is a lucrative capital gains play for investors.
On the date of publication, Steve Booyens did not hold any position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
