Disney (NYSE: DIS) is a magical kingdom, all right -- its profit surged 22% on a 10% increase in revenue. In fact, its theme parks had an "extraordinary quarter," according to CEO Bob Iger.
Despite nagging, troubling signs for consumer spending, kid-centric spending may not be suffering much spoilage, if Disney is any indicator indicator. (As for spoilage of any kids themselves, I'm not Dr. Spock.)
Not long ago, my Foolish colleague Kristin Graham and I discussed the idea that maybe Disney could do quite well even with an economic downturn. We wondered whether many parents will do without luxuries for themselves to budget for a wow of a vacation for the kids. That idea seems to be borne out so far.
Disney sure does seem to be bucking the trends when it comes to U.S. consumers. However, visitors from abroad were apparently also eager to meet Mickey and Goofy, particularly with a weak dollar sweetening the deal. Be on the lookout for longtime Fool Rick Munarriz's separate take on Disney's earnings today -- last quarter, he pointed out that Disney made bears look goofy, too.
News to go
A Goldman Sachs (NYSE: GS) analyst's prognostications about the possibility of $150- or $200-per-barrel oil may be the stuff of nightmares, although Wall Street seemed to take the disturbing news in remarkable stride yesterday. But imagine the prices at the pump with oil at those levels -- or don't, since it might ruin your breakfast. And Fannie Mae's (NYSE: FNM) tidings yesterday made me want to say, "Everything's fine? My Fannie!"
Not only did Fannie report a worse-than-expected quarterly loss, announce plans to raise another $6 billion in capital, and cut its dividend, but it painted a continuing dire picture of the housing market, too. That may not be surprising to some of us, but it doesn't seem very heartening. Perhaps somebody (or a lot of somebodies) raided the happy pills in the medicine chest, though, considering that this was apparently a big surprise to many on Wall Street, yet the market rallied -- and so did Fannie's stock, for that matter.
Whenever any big company in a major industry reports earnings lately, it's also a way to at least try to take the temperature of the economy. That brings us to Cisco (Nasdaq: CSCO).
There's no reason to call the paramedics. Cisco beat estimates with its third-quarter results, although its net income dropped by 5.4%. On the other hand, sales increased by 10%, a level that was expected last quarter, when the company said business was slowing.
Then again, Cisco's not exactly running with the bulls, either. The company said customers here in the U.S. and Europe remain cautious, and so it gave a cautious outlook for the current quarter, which does say something about the macro picture.
I suspect that a Foolish colleague will take a much more in-depth look at Cisco's results later today and will dig beyond my own early morning musings, which leave me thinking the results don't sound particularly unhealthy in the challenging climate. It's probably no time to go running around in the rain, though, even without bulls chasing you.
On Thursday and Friday, we're going to have to skip "Breakfast With the Fool." I know, it's bad to skip breakfast, so you should make time to grab a little something before you head out the door. We'll serve up more fresh breakfast news first thing Monday morning. Have a great and Foolish day!
To tide you over:
- The Next Bear Stearns
- Innovate Your Way to Higher Returns
- The Wall Street Myth That Could Destroy Your Portfolio
Disney is a Motley Fool Stock Advisor recommendation. To find out what other companies David and Tom Gardner have recommended to subscribers, take a 30-day free trial.
Alyce Lomax does not own shares of any of the companies mentioned. The Fool has a disclosure policy.
