Park Hopper Tickets: A Good Financial Bet for Disney
Will Park Hoppers help Walt Disney World up its effort to return to normal?
MickeyBlog.com covered it last week. And it was one of our most welcome stories in some time.
Park Hoppers are back!
And starting on January 1, 2021, folks will be able to visit more than one park at Walt Disney World.
BREAKING NEWS: Park Hopper Returns January 1, 2021 https://t.co/35rnpvg17i
— MickeyBlog.com (@MickeyBlog_) November 20, 2020
However, so is The Motley Fool’s Rick Munarriz, who posted to tell why park hopping was a very smart next step for Walt Disney World.
Good Things Coming For WDW?
Moreover, Munarriz explained why that smart step for WDW could mean great things for DIS:
https://twitter.com/Market/status/1326952028342521857?s=20
Folks tend to arrive early when they have a park pass reservation, but the safety measures can be exhausting. Like Disney’s Animal Kingdom through its first few years of operation, when it was often tagged as a half-day park, folks tend to head to the exits in the early afternoon. Some come back later in the day to the same park after taking a break, but now armed with park hoppers they are more likely to come back.
Disney charges a premium for its park hopper tickets. Getting folks to come back later in the day also helps increase big-ticket dinner purchases as well as merchandise and snack sales during the extended experience. Disney never reveals its revenue per-capita figure, but you can bet that it will go up in January.
The return of park hoppers will give folks avoiding a trip to Disney one reason fewer to stay away. It will be a more complete experience, and it will inevitably bring an increase in operating hours. Between guests spending more and the parks opening longer, you can already figure out what this will mean for many of the cast members who were laid off earlier this year.
Disney Parks: Can They Catch Up?
Meanwhile, fellow “Fool” Parkev Tatevosian expanded on the relative stability afforded Disney by its switch to a “Disney+ centered” approach. This ability to “tread water” during the COVID-19 allowed The Walt Disney Company’s other businesses to catch up, so to speak.
#Disney certainly making a strong case with its #earnings release today. #DisneyPlus #investing #stocks $AMZN $NFLX $DIS $IWM https://t.co/OUxKxK6W1H
— Parkev Tatevosian, CFA (@TMFParkev) November 13, 2020
[P]ositive developments in the battle against COVID-19 might allow the rest of its businesses to return to normalcy by the summer of 2021. According to Disney, there is pent-up demand for all of the above-mentioned businesses once they get back up and running, based on early results from the partially opened theme parks and early reservations for cruises.
It appears that Disney is six months to a year away from putting the nightmare of the pandemic behind it and returning to operating at full capacity. But now it has a rapidly growing streaming business to support its slower-growing but highly profitable legacy businesses.
With DIS trading over 140 at the moment, that’s good news for investors AND for fans, who wish to expand their in-park experiences even as they wear masks, social distance, and wait for vaccines.
