Jim Cramer’s Pounding the Table on This Stock— Should You Buy?

Jim Cramer believes in the magic to be had in shares of The Walt Disney Company (NYSE:DIS). Undoubtedly, Disney has had a broken stock for a number of years now. The company imploded more than 58% from its 2021 high to its 2023 depths.

Though shares have been more constructive since the lows of 2023, gaining just north of 37%, the name has continued to be an uncomfortable rollercoaster ride for investors. After having done virtually nothing in the past decade, it’s not hard to imagine that most investors have ditched the stock for something else.

Cramer’s sticking with DIS stock

In any case, Cramer thinks the name could be in for quite a comeback. Most notably, he referred to the parks business as “underappreciated.” I think he’s right on the money, especially as investors discount consumer demand for travel and leisure. 

In a somewhat frothy and turbulent market, Disney stock may very well be the deep-value play that allows for a relatively smoother ride. But as one of the untimeliest names over the past couple of years, is now a good time to be jumping in? Undoubtedly, Trump’s tariffs could weigh heavily on consumers’ pocketbooks.

Disneyland could stay resilient in the face of tariffs

One has to wonder if Canadians will still care to check out Disneyland or Disney World after the recent imposition of 25% tariffs on a broad range of goods moving from Canada into the U.S. The weaker loonie also doesn’t help the cause. Indeed, Canadians have a growing number of reasons to forego their next Disney plans, which could take away from the park business’ bounce-back potential.

Personally, I view Disney as far more resilient to tariffs than one would think. Indeed, with some of the most iconic brands in the world, it remains every child’s dream to go to Disneyland (or Disney World).

It doesn’t matter if the ticket prices are through the roof or if tariffs are imposed, for many kids, Disneyland really is the best place on Earth. And until that changes, I wouldn’t discount the staying power of Disney’s park business as it attempts to continue its recovery after a brutal past few years.

Furthermore, I’m a pretty big fan of management’s decision to invest in parks and cruises to power longer-term growth. I think it’s a wise move that could help Disney break out of its multi-year funk.

At the end of the day, Disney must keep spending if it’s to keep on delivering the best experiences for its guests. As new technologies (think robots and augmented reality) come to be, perhaps the Disneyland of the future will be a must-visit, even for adults without kids.

A strong content lineup for Disney+ ahead

Aside from the wonderful parks business that Cramer has been pounding the table on of late, I like the Disney+ content pipeline and think it may be in a better spot to give rival streaming platforms a better run for their money over the coming year.

Disney has a robust pipeline of big-budget theatrical releases (think the Snow White live action film and others) that will be trickling onto Disney+. Some hit shows are also up ahead for Disney+, including the second season of Star Wars flick Andor.

All considered, I do think Disney’s growth engines are finally working again. At 19.8 times forward price-to-earnings (P/E), DIS stock also looks quite cheap for what you’re getting, especially if long-term investments in parks start paying off gradually in the coming years.

The plus about Disney+

While the Disney+ content slate is getting better, I do wonder if the shift to a more profitable strategy will lead to fewer, but higher-quality hits as the firm narrows its focus on a few series that can really bring home the return on investment (ROI).

Indeed, perhaps ROI is the key to pulling ahead in the streaming race. For Apple (NASDAQ:AAPL), it’s the second season of Severance that’s drawing in massive numbers of subscribers. Perhaps season two of Andor could do the same for Disney as it looks to follow up on its most successful Star Wars show.

In any case, Cramer is right to be bullish on Disney. Its franchises are too powerful and it may not take all too long for the magic to return.

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