With all of their worldwide theme parks experiencing extended closures, 2020 was a tough year financially for The Walt Disney Company.

The far-reaching impacts of the global pandemic have led some analysts to predict that it could take years for the Disney parks to return to normalcy. Between the uncertainty surrounding the future of the theme parks and key leadership changes, many Wall Street analysts downgraded Disney’s stock rating in 2020.

In light of the immense challenges faced in 2020, the company’s Investor Day presentation in December was highly anticipated. And during this presentation, Disney CEO Bob Chapek made it clear that streaming services would be the company’s major focus moving forward.

Following the massive streaming service announcements made on Investor Day, the company’s stock reached an all-time high. And some analysts have now upgraded their rating of Disney’s stock, admitting that they miscalculated their future plans.

The Hollywood Reporter shared that LightShed Partners analyst Richard Greenfield upgraded his rating on the stock of The Walt Disney Company from “sell”  to “neutral” on Friday. Greenfield acknowledged that “our call has been dead wrong” and new CEO Bob Chapek “surprised us, leaning far harder into streaming.”

Greenfield had previously downgraded the stock in May 2020, as he explained “At the time we focused on how the market under-appreciated the impact of COVID-19 on fiscal 2020-2021 earnings.”

But Greenfield admits that he wasn’t expecting the company’s swift pivot toward streaming, “Disney management surprised us by recognizing the urgency of leaning much more heavily into streaming at the expense of near-term earnings – something for which we have advocated for years. And investors have rewarded Disney’s wise decision.”

Greenfield also pointed to Disney’s decision to increase content spending on Disney+ to more than $8 billion by 2024 compared to a target of $4 billion set just a year ago. He said the move is, “a dramatic acceleration, illustrating management now understands far greater spending is needed to accelerate gross adds, increase engagement to drive average revenue per user, and reduce churn.”

While Greenfield’s initial choice for Bob Iger’s replacement as CEO was former Disney executive Kevin Mayer, he said Chapek “has impressed us so far and in many ways is following the playbook that we expected Mayer to utilize if he had been made CEO.”

Here’s why 80% of Disney’s upcoming projects will head straight to streaming services!

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The post Disney Analyst Upgrades Stock After the Company’s Quick Pivot to Focus on Streaming Content first appeared on the disney food blog.