Amid a stock market sell-off in 2022, Walt Disney (DIS -0.12%) shares have fallen 44% since January. The company's fourth-quarter earnings release on Nov. 8 was a bit of a mixed bag, as its parks revenue soared, but its media segment took some concerning hits.

In 2023, the company will be heading into its second century of business and a potential recession. While Disney's short-term prospects may be uncertain, the company has proven the staying power of its content and is home to some of the world's most in-demand franchises. Its stock price is not far from its five-year low, which might present an excellent opportunity to snap up a bargain. 

Here's why you should consider buying the dip in Disney stock this year.

A state of transition

Disney was one of the few companies to suffer and gain during the pandemic lockdowns prevalent throughout 2020 and 2021. Its parks business experienced massive losses due to closures, while its streaming service Disney+ seemed to launch at the perfect time in 2019. The streaming service received a significant boost to its growth as home-bound people flocked to online entertainment platforms.

In three years, Disney+ has reached 164.2 million members, pushing the company's total streaming subscribers to 235.7 million, and beating Netflix's (NFLX 1.73%) 223.09 million.

However, the tables have turned in Disney's latest quarter. In fourth-quarter 2022, the company's Parks revenue grew 36% year over year, earning $7.4 billion, while its Media and Entertainment segment saw revenue fall 3% to $12.7 billion. Disney's operating income filled out a bit more of the story, with Parks operating income rising 136% to $1.5 billion and Media decreasing by 91% to $83 million. 

The slump in earnings from Disney's Media and Entertainment segment was primarily driven by the company's $30 billion content spend in 2022 as it worked to grow Disney+. Additionally, revenue took a hit from reduced theatrical releases, but those releases should increase going forward. 

Throughout 2022, Disney worked to diversify its business with its flagship streaming platform while also making changes within its parks to maximize profits. Its efforts have taken substantial investments but have paid off in its increasing subscriber count. Disney isn't done yet, as its ad-supported tier on Disney+ still has yet to launch, which could open the door for a revenue boost in the second half of fiscal 2023.

The going might get tough for the short term, but if all goes according to Disney's plan, it could come out the other side with a reliable parks business and a highly profitable streaming platform. 

Excellent long-term prospects

Despite Disney's streaming pitfalls in its fourth quarter, the company expects Disney+ to reach profitability in its fiscal 2024, with its operating losses beginning to "narrow going forward." It has said price increases across its streaming platforms, and the introduction of its ad-supported tier on Dec. 8, will set it on the path toward profits. 

Disney+ has risen faster than any streaming service in history. Industry founder Netflix didn't reach Disney+'s current subscriber count until 2019, 12 years after its streaming service launched in 2007. Disney has accomplished its swift streaming expansion with the draw of its incredibly potent content brands such as Marvel, Star Wars, Pixar, 20th Century Studios, and all of its franchises from Walt Disney Studios. 

If investors are patient, they could see big gains as Disney grows its dominance over the $327 billion streaming industry in the coming years. Fortune Business Insights expects it to see a 19.9% compound annual growth rate and reach a value of $1.6 trillion by 2029.

Moreover, Disney has taken steps to maximize profits at its parks in 2022, which could boost earnings even if attendance slips amid a potential recession. Moves such as ticket price increases and monetizing its once complimentary FastPass service are ways the company can increase its revenue per guest and grow profits.

Disney has embarked on an expensive but promising transition to diversify its business, maximize efficiency, and grow revenue over the long term. And with a price-to-earnings ratio at 69% below what it was a year ago, Disney stock is a bargain and worth buying on the dip to hold long-term.