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The Walt Disney Company Weighs In on Its Intellectual Properties

Ray Sheffer - Author

May 26 2015, Updated 9:07 a.m. ET

Disney’s intellectual properties

In the previous part of this series, we learned that Frozen is contributing value to different Walt Disney Company (DIS) segments. In the MoffettNathanson Media & Communications Summit on May 13, the company highlighted its intellectual properties portfolio. Lowell Singer—Disney’s senior vice president of investor relations—commented, “Look, we talk about Frozen as the most recent example, and we’ll come back and talk more specifically about it. But, if you go back and look at last year, we had 11 franchises across the company that did more than $1 billion in retail sales.”

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As you can see in the figure above, Disney has a wide assortment of intellectual properties. These properties have generated value even many years after their creation. Cars was released almost a decade ago. However, this intellectual property is currently making more than $1 billion in retail sales.

Leveraging its multiple segments to extract value from intellectual properties

According to the company, it actively contributes to generating value from its intellectual properties for a long time. It extends the attractiveness of these properties throughout their lifetimes.

At the MoffettNathanson event, Lowell gave examples of how the company added value to some of its properties. Some of these moves were releasing sequels and short movies relating to the original movies. They also included promoting these properties and their characters in the company’s parks and resorts.

If you want to take on diversified exposure to Disney, you may invest in the Consumer Discretionary Select Sector SPDR Fund (XLY). The ETF held ~7.4% in the company on April 30, 2015. The ETF also held a total of ~12.1% in media companies Comcast (CMCSA), Time Warner (TWX), and Twenty-First Century Fox (FOXA).


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