You will be redirected back to your article in seconds

Netflix Investors Apparently Excited Over Disney Acquisition Rumor

Netflix stock climbed above $100 per share on Monday, to its highest levels since May — fueled by a rumor circulating on Wall Street that Disney might possibly be interested in acquiring the video-streaming leader.

Netflix stock closed up 4.1% Monday, to $102.63 per share, on higher-than-usual volume. On Tuesday, Netflix shares climbed as high as $104.44 in early trading, before settling down to below the opening price of $103.50.

Rumors that the Mouse House or possibly Apple might be interested in snapping up Netflix — which currently has a market cap exceeding $44 billion — were alluded to in a research note by Robert W. Baird & Co. analyst Will Power. Regarding “recent M&A rumors,” Power wrote, “whether Disney, Apple or someone else, Netflix could become a target.”

Netflix investors have been concerned about the company’s slowing growth in the U.S., as it undertakes a shift to move all subscribers to the $9.99-per-month standard tier. The stock, which has a notoriously volatile history, is trading well off its $133.27 per share 52-week high.

Speculation that Disney might be looking to make a major deal for Netflix comes after the media conglomerate was said to be looking at buying Twitter, according to a Bloomberg report. Disney also has demonstrated a keen interest in the streaming-video market: In August, it announced the purchase of a 33% stake in Major League Baseball’s BAM Tech unit for $1 billion.

The first issue for Disney would be trying to justify the massive purchase price: Netflix trades at a whopping price-earnings ratio of around 320, and any deal would have a negative impact on Disney’s balance sheet and earnings. Disney also would face other potential hurdles if it actually moved to buy Netflix, including regulatory scrutiny and the fact that rival studios would be even more reluctant to play ball with a Disney-owned Netflix.

Popular on Variety

More Digital

  • Apple Arcade

    Apple Officially Launches Apple Arcade Game Subscription Service

    Apple officially cut the ribbon for its new game subscription service Thursday: Priced $4.99 per month, Apple Arcade offers unlimited access to over 100 exclusive games. Apple Arcade was released alongside iOS 13, the latest version of Apple’s mobile operating system. Some of the titles available through the subscription package include “Lego Brawls” from Lego [...]

  • Kim Kardashian Kim Kardashian out and

    Nielsen Now Tracks Celebs' Social-Media Touts of TV Shows

    Nielsen is providing a new lens into how celebrities and talent can boost the exposure of TV shows on social media. The measurement company announced that its Social Content Ratings solution now measures talent promotion of television programs across Twitter, Facebook and Instagram. According to Nielsen, talent now drives nearly 60% of all social engagement [...]

  • Homecoming

    Peak Storytelling Here as Podcasts, Short Form Ride New Wave

    The concept of peak TV is nothing new. But scratch the surface of original content these days, and it’s no longer about television — from podcasts and short-form video, storytelling itself is at a peak. Thanks to audio, video and other new platform companies including Gimlet, Quibi, Wondery, iHeartMedia and Serial Box, listeners and viewers [...]

  • Roku Express 2019

    Roku Launches New Streaming Devices, Doubles Down on Content Curation

    As every year, Roku is going into the holiday shopping season with a handful of new devices: The company unveiled a revamped $30 entry-level Roku Express streaming device as well as new version of its $100 Roku Ultra streamer Thursday. Additionally, Roku also announced a new version of its software platform that puts a bigger [...]

  • Paradiso

    New Podcast Studio Paradiso Launches With Series for Spotify, Sybel (EXCLUSIVE)

    Former executives from Canal Plus, entertainment company Konbini and advertising film Havas have joined forces to launch Paradiso, an international podcast production studio dedicated to delivering premium scripted, documentary and kids’ content for global platforms. The company has already scored commissions from Spotify and Sybel. Paradiso’s founding partners are Lorenzo Benedetti, the founder of Studio [...]

  • Brad Pitt stars in “Ad Astra”.

    ‘Ad Astra’ Once Again Tops Studios’ TV Ad Spending

    In this week’s edition of the Variety Movie Commercial Tracker, powered by the always-on TV ad measurement and attribution company iSpot.tv, Twentieth Century Fox claims the top spot in spending for the third week in a row with “Ad Astra.” Ads placed for the sci-fi film had an estimated media value of $6.47 million through [...]

  • Andrew MorseVariety's Entertainment & Techonology Summit,

    Listen: CNN Digital Chief Says Trump Doesn't Drive Traffic Success

    No subject might get as much attention across CNN’s digital properties as Donald Trump, but that doesn’t mean the news network is dependent on him for web traffic. Andrew Morse, executive VP and general manager of the AT&T-owned company’s digital operations, pointed to recent coverage of natural disasters and international incidents as more potent audience [...]

More From Our Brands

Access exclusive content