Dear Mr. Berko: We bought $50,000 worth of the 5.3 percent Tesla bond in August 2017. Our stockbroker wants me to sell, take a tax loss and use the remaining money to buy 200 shares of Tesla stock. My wife is insistent that we buy 800 shares of The Walt Disney Co. We need your opinion.
— J.L., Portland
Dear J.L.: You’ve got a smart spouse. I’d listen to her.
Holy Moses, Marie and Malachi! It’s hard to believe that just a dozen years ago, The Walt Disney Co. (DIS-$102) was trading at just $24. And jumping Jack Sprat, who would imagine that in 1967, just before a 2-for-1 split, Disney was trading at $100 a share? Gee whiz, Willie Lee, if you had bought 100 shares of DIS in 1967 and held it through six splits, today you’d own 34,800 shares worth about $3.5 million. That’s not an unacceptable return.
Today DIS isn’t just an amusement park. Disney owns media networks, including ESPN and ABC, accounting for 43 percent of its $55.6 billion in 2017 revenues; parks and resorts — including Animal Kingdom, Epcot, a cruise line and parks in Paris, Tokyo and Hong Kong — which contributed 30 percent of 2017 revenues; studio entertainment, which is responsible for 17 percent of revenues; and consumer products and interactive media, which produce 10 percent of revenues. And the Disney beat goes on. In December, DIS signed an agreement to buy 21st Century Fox, which includes film and TV studios, their respective libraries, and cable and international TV operations. DIS will pay $53 billion for 21st Century Fox, which is about $30 billion less than AT&T wishes it could pay for Time Warner. I’m told by a moderately knowledgeable source that if the government prevents the $85 billion AT&T and Time Warner merger, Disney could make an offer.
