While Netflix’s subscriber growth has been boosted by hit shows such as Squid Game, additions to the Disney+ streaming app missed Wall Street estimates on Wednesday evening.
For Morgan Stanley analyst Benjamin Swinburne, streaming is key to Disney’s investment case.
About 78% of analysts have buy ratings on the former and none recommend selling, while 73% recommend buying Netflix and five have sell ratings.
Netflix shares trade at a widening premium to Disney’s based on Wall Street’s preferred valuation measure, enterprise value to projected earnings excluding costs like interest and taxes.
The premium is due to a chasm in the amount of revenue the companies generate per streaming subscriber, according to Geetha Ranganathan, a senior analyst at Bloomberg Intelligence.
The electric vehicle maker surged 29% in its first day of trading after attracting a flurry of retail investor buying.
Rivian continued its rally on Thursday, rising as much as 15%.
Rivian’s surge outpaced the average performance of this year’s technology debuts, which have jumped by an average of 23%, according to data compiled by Bloomberg.