Hightower's Stephanie Link buys shares of Disney, says they're 'attractive' after Bob Iger's return

Published Tue, Nov 22 20221:49 PM EST

Stephanie Link, chief investment strategist at Hightower, bought shares of Disney , calling them attractive after the return of Bob Iger signaled a clean-up at the media company. "Iger has a great reputation. He's got experience, he's got content, connections and that is really key. The costs are so bloated, there's so much that they can do, they spend more than Netflix, right, and they don't have nearly the same subscriber base," Link said Tuesday on CNBC's " Halftime Report. " What's more, the investor said she expects the stock has already priced in bad news, including expectations of a looming global slowdown that will hurt its theme park business. "I think the valuation, while not super cheap at 23 times forward, relative to its five-year history of 49.5 times forward, that, to me, is more attractive," she added. "I just think the risk-reward right here is pretty good." Still, not everyone on the "Halftime Report" agreed with the trade, with Josh Brown, CEO of Ritholtz Wealth Management, saying that the stock has further to fall even after tumbling more than 38% this year. Shares of Disney closed up more than 6% Monday following the CEO change announcement, but they are down more than 2% during Tuesday trading. "The news is in, we all know Iger's back now, why is it trading down?" Brown said. "Because whatever Iger is there to do, it's probably not just to clean things up a little and be a caretaker." Brown expects that the CEO change could signal "transformative transactions" ahead at the media company, probably within the "first couple of quarters" of Iger's return. Over his previous tenure at Disney, Iger led notable acquisitions in Pixar, Marvel and Lucasfilm. "I don't know what the plan is going to be. But I promise you, ... he's going to do something big, and that doesn't necessarily translate to a higher stock price, at least once it's announced," Brown said. Regardless, Link said she thinks the stock will outperform over the next two years with Iger at the helm, and said she wouldn't be surprised if he stayed on longer at the company. Separately in the same "Halftime Report" episode, Brown named CrowdStrike the best of the cybersecurity names. He said he has a small position that he may add to in the future, though he noted that the stock is not cheap.