How to play Disney’s Hulu deal, according to Creekmur Wealth Advisors’ investment chief

Creekmur Wealth Advisors' CIO John Creekmur sees Disney as a buying opportunity after its acquisition of Comcast's stake in Hulu, citing Hulu's profitability and a $133 price target (12% upside). While positive on Taiwan Semiconductor's long-term potential with a target of $240, Creekmur anticipates a near-term pullback to the $192-$195 range before aggressively buying. Conversely, Creekmur remains bearish on J.M. Smucker due to rising input costs, inelastic pricing, and squeezed margins.

Analysis

John Creekmur, CIO of Creekmur Wealth Advisors, views The Walt Disney Company (DIS) as a buying opportunity following its acquisition of Comcast's 33% stake in Hulu for $438.7 million, thereby gaining full control. This strategic move, focused on Hulu which Creekmur identifies as Disney's most profitable subscription service, contributed to a more than 2% rise in Disney's shares on Tuesday; Creekmur sets a $133 price target, suggesting a 12% upside from the recent close, supported by a high per-ticker sentiment score of 0.8 for DIS. For Taiwan Semiconductor (TSM), despite a recent nearly 10% rally in June and a 2% share increase on Tuesday after a reported boost in May revenue, Creekmur anticipates a short-term pullback. He advises holding TSM, currently at $212.46, and targeting an aggressive buy if it retracts to the $192-$195 range, projecting a subsequent rally to $240 (a 25% upside from the potential low), though current per-ticker sentiment is slightly negative (-0.2), reflecting this pullback expectation. Conversely, Creekmur recommends avoiding J.M. Smucker (SJM) due to its disappointing quarterly revenue and ongoing margin pressure from rising input and labor costs combined with inelastic pricing, a view reflected in a very negative per-ticker sentiment score of -0.8. The overall sentiment captured from these diverse outlooks is mixed (0.0 score), with a relatively low market impact score of 0.3.

Key Decisions for Investors

• Investors might view Disney's complete Hulu acquisition positively, considering the analyst's $133 price target and Hulu's noted profitability within Disney's streaming portfolio.
• For Taiwan Semiconductor, a patient approach could be warranted; monitor for a potential price correction to the $192-$195 level, which the analyst identifies as an aggressive buying opportunity for a long-term target of $240.
• Caution is advised regarding J.M. Smucker, as the analyst highlights significant headwinds from rising costs, inelastic pricing, and disappointing revenue, suggesting investors stay away from the stock.