Disney's Full Control of Hulu Signals a Buying Opportunity
John Creekmur, Chief Investment Officer at Creekmur Wealth Advisors, sees Disney’s recent move to acquire Comcast’s stake in Hulu as a strong buying signal. On Tuesday, following the announcement that Disney would pay $438.7 million to assume full ownership of Hulu, Disney's shares jumped over 2%. This strategic acquisition, years in the making, was initially disclosed in 2023 when Disney revealed its plan to purchase Comcast's 33% interest.
Creekmur emphasized Hulu’s profitability among Disney’s subscription services, highlighting how this deal enhances the entertainment titan’s appeal. He set a price target of $133 per share, projecting a potential upside of roughly 12% from the latest closing price. "We love Disney right now," Creekmur remarked, underscoring his bullish stance.
Taiwan Semiconductor: Expecting a Temporary Pullback
Taiwan Semiconductor Manufacturing Company (TSMC) has experienced a substantial rally in June, with shares increasing nearly 10% amid sector-wide gains. Tuesday saw another 2% rise following a robust revenue report for May. However, Creekmur advises caution, suggesting the stock is slightly overheated.
Currently trading at around $212.46, he anticipates a short-term pullback to the $192-$195 range, amounting to over a 9% dip. This correction, he believes, will set the stage for aggressive acquisitions. Creekmur envisions strong momentum propelling the stock to a target near $240, implying a 25% gain from the pullback level.
Why J.M. Smucker Remains Unattractive Amid Rising Costs
In contrast, Creekmur remains wary of J.M. Smucker, citing disappointing quarterly revenue figures as a red flag. Since mid-last year, he’s maintained a less favorable view, pointing to inflation-driven increases in input and labor costs that pressure margins. Additionally, Smucker’s pricing lacks flexibility, exacerbating margin compression.
"We'd stay away from Smucker right now," Creekmur advised, reflecting a defensive approach toward the stock amid challenging cost dynamics.