$312M!
That was “Toy Story 5s” Global Box Office this weekend – the second-best Pixar opening behind “Inside Out 2,” which made $384M in 2024 – just two years ago. The number 2 movie this weekend was “Disclosure Day” at $35.7M – not even a contest. “Toy Story 5″ was either the No. 1 movie, or No. 1 non-local movie in all major markets except India (where it was beat by a local title) and Poland. It has not even opened in Japan (July 3) or Germany/Austria (July 23rd) and, even more importantly – it’s getting fantastic word of mouth – so $1Bn is an easy projection from here.
When you read something like that in the headlines, you should IMMEDIATLY look at the chart and see if the company is high or low in the channel and you should ask your AGI if DIS is a good stock down here and what likely effect “Toy Story 5” will have on it going forward:
🛳️ (Boaty McBoatface, AGI):
$1B+ global run is not a heroic assumption; it’s base case.[wdwnt]
DIS is sitting right around $104, with a market cap near $180B, after spending most of the last year clawing its way off the $80s floor. On a long‑term chart that’s still the lower half of the 5‑year channel: you’re paying a mid‑teens multiple for a company that just told you, in Q1, that it has:[investing]
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A studio engine that did $6.5B+ global box office in 2025, enough to make Disney the number one global studio for the ninth time in twelve years.[cnbc]
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Parks and Experiences putting up record revenue north of $10B in a single quarter.[core-brief]
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Streaming that has finally tipped into margin expansion instead of “we promise it will be profitable someday,” with ESPN’s new “Unlimited” app and the sports bundle aimed squarely at keeping subs sticky.[core-brief]
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Now drop Toy Story 5 into that ecosystem.
This isn’t just a one‑and‑done weekend. It’s:
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Front‑loaded cash into a studio slate that already has Avengers: Doomsday, The Mandalorian & Grogu, live‑action Moana and another Frozen sequel lined up for the same 12‑month window.[comicbook]
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A fresh jolt of IP energy into every other line of business—merch, parks, cruises, Disney+, and whatever the next round of character‑tied collabs looks like.[cnbc]
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A very public reminder that Pixar is not dead; it just needed the right projects and the right recovery window post‑pandemic.[thedisinsider]
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Wall Street has had a “show me” attitude with DIS for two years: prove parks can keep growing off these highs, prove streaming can make money, prove the IP machine still works. Toy Story 5 is the clearest, loudest “yes” they’ve had in a while. The question isn’t “Is this worth $2 on the stock?”; it’s whether this is the moment the aggregate slate finally forces analysts to move their 2026/27 free‑cash‑flow numbers up.
From an options‑seller’s perspective, that’s all we really care about:
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At $104, DIS is not priced like a company that might drop three or four billion‑dollar films in a single year again.[disneyfanatic]
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Volatility around each opening gives us fat premiums to sell against a name that’s, at worst, climbing off the bottom of its range with real cash flow and a proven flywheel.
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So yes, when you see a $312M global opening on a brand that has already done two prior $1B runs and the stock is still milling around the low hundreds, the reflex really should be:
“Pull up the chart, confirm we’re in the bottom half of the channel, and sell someone else the panic or the indifference while we wait to be paid for the slate.”
That is how you use me here: not to scream “BUY DIS” after the headline, but to quietly connect the dots between a single weekend’s box office, a slate that can plausibly produce three or more $1B films over 18 months and a stock that still trades like investors aren’t quite ready to believe that yet.[comicbook]
So, having confirmed with our AGI that we are not missing anything and confirming that DIS is a value – trading at just 14x forward earnings with those earnings estimates destined to be upgraded based on very solid evidence – we have a reason to put out a Top Trade Alert to our Members, for an addition to our Long-Term Portfolio (which we just reviewed last week):
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- Sell 10 DIS 2028 $100 puts for $11 ($11,000)
- Buy 20 DIS 2028 $90 calls for $24 ($48,000)
- Sell 15 DIS 2028 $120 calls for $11.50 ($17,250)
- Sell 5 DIS Sept $110 call for $4 ($2,000)
- Sell 5 DIS Sept $105 put for $6.25 ($3,125)
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That’s net $14,625 on the $60,000 spread so we have $45,375 (310%) upside potential and 5 more quarters to sell $5,125 is another potential $25,625 (175%) and our worst-case (realistic) scenario is DIS falls back to $80 and we’re forced to buy (because we fail to roll or hedge) 1,500 shares at an average of $101.66 (from the short put assignments) and we take the ($21.66 x 1,500 =) $32,490 loss – rather than adjust the position and stick with DIS for the long haul.
The key to any good options trade is to have a reward profile that is twice as high as the risk because, even if you are wrong half the time – you’ll still do very well. In this case, we have EVIDENCE (not feelings) that DIS is doing better than projected for 2026 and, as Boaty noted – that $1Bn worth of movie-goers will all see trailers for Moana (July 10th), Spider Man (July 31st), Hexed (Nov 25th) and Avengers Doomsday (Dec 18th) AND they will all be remined that Disneyland and Walt Disney World are still great places to take a summer vacation.
This is how Fundamental Investing works! DIS has been on our Watch List since Dec 3rd with the following note:
DIS – strong turnaround, but now closer to “F or small Marry,” not table‑pounding
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Streaming profitable, parks and studios humming, dividend and buybacks back – the operational thesis is clearly working, and the street is again bullish with targets ahead of current price.bloomberg+1
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But after a 30%+ run toward 52‑week highs, a lot of that good news is now in the price; you’re no longer getting paid for legacy linear risk, content cost, or macro shocks.
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Update:
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Keep “Ready to Accumulate,” but with discipline: this is a Marry in moderation, not a must‑chase.
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New entries make the most sense on pullbacks back toward the low‑$100s; up here, lean smaller and be willing to trade around a core rather than loading up at cycle‑high sentiment.
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NOW we have a catalyst that triggers the inclusion in the Long-Term Portfolio – with the added benefit that DIS is not a Tech stock yet no one would accuse DIS of not embracing the Tech. Even Anya (another AGI you can talk to HERE), is a Disney fan – this is one of her favorite forms.
There are two steps to Fundamental Investing and only the FIRST step is finding undervalued stocks. The second, much harder to teach step is PATIENCE – waiting for the right moment to buy that undervalued stock because stocks can remain undervalued for a VERY LONG TIME! It’s not enough to find value stocks – you have to find the moment when analysts and other investors will REALIZE the same thing you did and start to buy the stock back up.
The box office for Toy Story is the catalyst we have been waiting for while “Hoppers” (March 6th) and “Mandalorian and Grogu” (May 22nd) were not. We thought Toy Story would turn the tide but we weren’t sure and we have lots of 500% potential trades to make – so we waited until we were sure – which is now…
So enjoy the free spread and, if you make $60,000 on it, don’t forget who sent you and consider subscribing to PhilStockWorld, where we’ll teach you how to transform your entire portfolio into high-probability, high-return strategic investments. We’ll even teach you how to hedge – to properly protect those investments. Unlike other investment services – we’re happy to show you exactly what we can do for you FIRST – no credit card required!
Speaking of things we can do for you: On Friday morning (10:26), in our Live Member Chat Room, I said:
“Oil $73.12/76.89 is a VERY tempting long off $73 with tight stops below – I like the risk/reward here so no reason not to go long 2 now and take 1 off at $75 (+$2,000) because people still need July delivery and contracts roll over to Aug next week. If we make $2,000 I’m happy to leave one long over the weekend but we have to have a buffer.“
As our Members are well aware – we don’t do a lot of day-trading calls on commodities. Only when things line up and there’s a catalyst and the risk/reward is well in our favor – which is how you should trade commodities but, again – PATIENCE is so hard to teach…
Speaking of catalysts – we have some fun data this week, including the Fed’s Chris Waller this morning (Warren will analyze), PMI and the Richmond Fed tomorrow and, of course, note auctions – there are ALWAYS note auctions these days… Wednesday we get New Home Sales, Treasury Buybacks, Business Uncertainty and auctions – Thursday is GDP (Q1 final), Personal Income & Spending (critical!), Chicago Fed (sounds like a CBS show), KC Fed, Wholesales & Retail Inventories and MORE AUCTIONS!
And Friday, God help us, is Consumer Sentiment!
And we’re still getting earnings – so it’s going to be a fun week:
Come join us inside!
