Netflix has long been at the forefront of changes in the media landscape, with its leadership position in the streaming wars. This has supported huge growth that has driven shares 732% higher in the past decade (as of Jan. 15).
With its unmatched treasure trove of intellectual property, Walt Disney (DIS 1.83%) is no slouch in the entertainment industry. But this consumer discretionary stock trades 44% below its peak.
Which of these companies will make you richer?
Image source: Walt Disney.
Consider Disney's low valuation and streaming upside
Disney shares currently trade at a forward price-to-earnings (P/E) ratio of 17.2. That's much cheaper than Netflix's 27.3 multiple. This is one reason why the House of Mouse can make investors more money over the next five years.
Another factor to consider is Disney's burgeoning direct-to-consumer (DTC) streaming profits. Operating income within this segment jumped nearly 10-fold in fiscal 2025 (ended Sept. 27, 2025) compared to fiscal 2024. It is expected to climb meaningfully in the current fiscal year.
Valuation expansion and DTC earnings gains introduce two powerful tailwinds that can lift Disney stock to new heights.
NYSE: DIS
Key Data Points
Waiting for a Netflix pullback
Netflix stock is well off its all-time high from June last year. If the share price continued falling such that the forward P/E ratio approached 20, then it would be time to have a fresh discussion about what the better investment opportunity is between Netflix and Disney.
