If you thought Disney was the king of the castle after acquiring 20th Century Fox last year, you might want to sit down. After the stock market has started on a slippery downward slope as a direct result of the coronavirus crisis, one Wall Street analyst suggests a company the size of Apple could swoop in and buy Disney as its stock continues to fall. In a letter to clients Friday, Rosenblatt Securities' Bernie McTernan suggested the Tim Cook-led company could make a reasonable bid for Bob Chapek's Disney now that shares of the latter have slipped 36 percent since January.
"We believe those with long-time horizons, like mega-cap companies with large cash balances and whose equity outperformed Disney over the last three weeks, like Apple, could take advantage of the volatility," McTernan writes (via THR), adding, "The upside from acquiring Disney would be securing their content/streaming strategy and potential synergies from adding the emerging Disney ecosystem to the iOS platform."
In the letter, McTernan made sure to note Disney has lost approximately $85 billion in the last three weeks, roughly one-third of its total market cap. As of that writing, the Mouse's market capitalization was hovering around $165 billion while Apple carried $107 billion in cash and securities.
The notion isn't something that's new. After Disney ended up buying Pixar in the mid-2000s, Steve Jobs became the largest shareholder of the House of Mouse. In fact, he even had a seat on the board of the company. In Bob Iger's memoir he released last September, the former Disney suggested the companies might have even merged already if Jobs were still alive. Jobs died due to complications of pancreatic cancer in 2011.
"If Steve were still alive, we would have combined our companies, or at least discussed the possibility very seriously," Iger wrote.
Cover photo by JOSH EDELSON/AFP via Getty Images3comments