Is it Smart to Invest in Streaming Services?

Even if you don’t plan on giving up your cable for a streaming service, there are several opportunities you can take advantage of when you want to stream certain movies and TV shows at home. Since there are so many streaming services to choose from, now is the ideal time to invest in a video streaming company. However, you may be overwhelmed with the variety of investment choices available.

This industry has changed significantly in the last 10 years. You may remember getting a red envelope in the mail with a DVD or movie to enhance your satellite or cable viewing list. The world of streaming services is still growing and changing. Recently, Sony announced the end of its PlayStation Vue service. Walmart is looking to sell its streaming service, Vudu. And, more providers are preparing to launch in the upcoming year.

If you’re wondering whether you should invest in streaming services, the short answer is yes. However, if you’re not sure which service is best, here are five to choose from.

Netflix

Netflix is a leader in the video streaming industry and is a great choice for investment. The high-water mark for conventional cable TV subscriptions reached 97.6 million households in 2012 — this was the same year Netflix decided to split its DVD rental and video streaming capabilities. According to eMarketer, Netflix is expected to be the streaming service in 80 million households by 2021. By this time, it is expected that about 20% of households won’t have traditional cable.

Netflix has been adding millions of new subscribers but still has other plans in mind for expansion. The company is increasing in popularity in several countries and is cracking down on account sharing to boost profits. Analysts say Netflix will likely increase advertisement to attract new consumers as well.

Disney

When you think of Disney, you likely think of more than a streaming service, or you may not think of streaming at all. However, investors say you should keep Disney in mind if you want to buy stock in a video streaming company. Disney+ is a new service but is attracting several consumers due to its Mandalorian series (based on Star Wars) and a host of Disney classics you likely watched as a child.

Disney+ may face several cancellations after the Madelorian season ends, just as HBO dealt with cancellations once Game of Thrones ended. However, you’re likely to find several other Disney shows and movies to keep you and your family interested.

This year, Disney made more than $13.4 billion from affiliate fees. The company charged satellite and cable companies to carry ESPN and Disney Channel, and Disney owns ABC, so your investment in Disney+ could be a smart financial move.

Hulu

Hulu has around 232 million users, which makes investors wonder about the actual price of Hulu stock. Hulu is a private company and is not part of public stock exchanges right now. However, you can still make money from investing in this online streaming service.

According to Fortune, Hulu considered the option of public offering in 2010 but Wall Street was resistant to the idea. During this time, Hulu offered free content streaming and didn’t have a monetization plan. According to Money Morning, “Three companies that each own 30% of Hulu. They are Comcast Corp., Walt Disney Co., and Twenty-First Century Fox Inc.”

Amazon

Amazon reported “record-breaking” numbers in the 2019 holiday season. The company shipped billions of goods and sold Amazon devices like the Echo Dot. About 5 million consumers around the world became Amazon Prime customers as well.

When you sign up for Amazon Prime, you’re getting more than a streaming service. You can also purchase items with a two-day delivery and/or free shipping guarantee. Amazon is expected to spend around $7 billion in 2020 for new streaming content, which is an increase from $4.5 billion in 2019. This indicates that investing in Amazon in any capacity is likely a wise financial move.