DIS Jun 2024 60.000 put

Disney, Netflix: Strategist says buy one, avoid the other

It's the battle of the streaming giants. In the debut episode of Good Buy or Goodbye, Sarge986 LLC President Stephen "Sarge" Guilfoyle explains why he is buying Disney and avoiding Netflix. Guilfoyle likes Disney (DIS) because of its valuation and the activist investment from Trian's Nelson Peltz. Guilfoyle argues that if Peltz can put pressure on CEO Bob Iger and other board members, it can be "hugely positive, just in perception terms." Guilfoyle also points to the stock's technicals, saying the stock has support at around $86. As for risks, Guilfoyle says if Peltz's proxy fight fails or Iger doesn't appease him or work out a compromise, it could be "a big negative for shareholders." A deep recession would present a downside for Disney stock too, he adds. So what does Guilfoyle not like about Netflix (NFLX)? The stock is "really expensive relative to Disney" and the streamer is burning through too much cash, Guilfoyle explains, adding "they are priced as a growth stock, they are not a growth stock." Guilfoyle also points to bearish technicals. Guifoyle says his "panic point" on Netflix would be if the stock starts to reach a triple top. You can watch more Good Buy or Goodbye by clicking here. Catch this full episode of Yahoo Finance Live here.