Please ensure Javascript is enabled for purposes of website accessibility

Disney World Will Still Feel Hurricane Dorian's Sting

By Rick Munarriz - Sep 2, 2019 at 9:15AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Central Florida's theme parks remain open as the fierce windstorm shifts away from making landfall in Florida, but tht doesn't mean Disney and its peers are out of the woods just yet.

The state of Florida may have dodged a catastrophic bullet, as Hurricane Dorian's projected path shifted through the Labor Day holiday weekend. Chunks of the state, particularly along the Eastern seaboard, will definitely feel an impact in the next day or two, but the same vicious windstorm that just a few days ago seemed ready to cut through the heart of the Sunshine State is now modeled to stay in the Atlantic as it moves up the coast. 

Of course, hurricanes are fickle beasts, but Floridians, insurers, and even theme-park operators are almost at the point where they can exhale as the record-setting storm moves on. Still, that doesn't mean the vicious storm won't leave a mark on the theme-park industry.

Alice in Wonderland poses with Rabbit and Mad Hatter in front of the Mad Tea Cups ride at Disney World.

Image source: Disney.

Through the turnstiles

No theme-park operator had as much riding on this holiday weekend as Disney (DIS -0.70%). Star Wars: Galaxy's Edge, Disney World's most ambitious expansion in two decades, opened at Disney's Hollywood Studios on Thursday. That was the same day the multiweek International Food and Wine Festival launched at Epcot. 

So things may seem like business as usual at Disney, Universal Orlando parent Comcast (CMCSA -0.02%), and SeaWorld Entertainment (SEAS -2.27%), all of which are keeping their Central Florida attractions open -- for now. But tourists have a different take on the situation. Many people canceled their reservations at the last minute when they weren't sure about Hurricane Dorian's stateside stomping grounds. Orlando International Airport announced on Friday that it would suspend flights starting on Monday, a popular travel day for tourists on the extended Labor Day weekend -- and even though the airport reversed its stance on Saturday, when the storm started shifting away from the state's center, the damage was done if potential visitors scrapped their plans. 

On the other hand, Disney, Comcast, and SeaWorld have closed their parks on short notice in the past, and they could do that again on Tuesday or even Wednesday, if the threat to the area intensifies. So no matter what happens, the storm is leaving a mark.

All three operators also now have a scapegoat in case attendance trends are unflattering for the current quarter. Disney, still trying to claw its way back into investors' fancy after a rough quarter at its theme parks last time out, can't afford back-to-back periods of declining attendance at its domestic theme parks. 

Comcast saw its global theme parks post an overall increase in turnstile clicks in the same quarter Disney buckled, but it continues to grapple with the uptime reliability of the Harry Potter-themed roller coaster it opened in June. SeaWorld also fared better than Disney in the second quarter, and its stock hit six-year highs this summer as attendance, margins, and earnings continue to move higher. However, the current quarter is the seasonally potent period that includes the lion's share of the summer school break.

Now investors will have a reason to fret about the inevitable financial updates. This is the season for these three consumer discretionary stocks to shine, but Hurricane Dorian might still have other plans. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

The Walt Disney Company Stock Quote
The Walt Disney Company
$102.42 (-0.70%) $0.72
Comcast Corporation Stock Quote
Comcast Corporation
$42.01 (-0.02%) $0.01
SeaWorld Entertainment, Inc. Stock Quote
SeaWorld Entertainment, Inc.
$54.76 (-2.27%) $-1.27

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/22/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.