Disney (DIS) CEO Bob Iger has said that if it weren't for Steve Jobs's death in 2011, his company may have merged with Apple (AAPL).
Now an analyst at Needham is suggesting that Apple would stand to increase its value by as much as 25% if it bought Disney using Apple stock.
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"Offensively, as an upside value driver, strong distribution and world-class content are complementary networks. That is, they are worth more together than separately, we believe," Martin said in a note, according to Markets Insider.
Apple could monetize its customers who use Apple devices for an average of four hours per day, Martin said. The company has 1.25 billion customers with 2 billion devices, she said.
Apple already has a number of subscription services, including Apple Music, Apple TV+, Arcade, Fitness+ and Apple News.
"What Apple does best is distribute content globally to 2 billion high-end mobile devices owned by 1.25 billion unique and wealthy users," Martin said. "And what Disney does best is create AAA content franchises, which it distributes globally across all screens, as well as in the physical world."
Both Apple and Disney have loyal global fans, premium pricing power and a wealthy consumer base, according to the note.
"This implies that these key assets and value-drivers become stronger, and are not diluted, if the two companies are put together," Martin said.
"I think Apple is doing a very mediocre job of streaming," Martin said on CNBC March 30, according to Markets Insider. "They just said they were going to do a billion dollars in film financing. That's sort of laughable, because these companies that are competing in content businesses are spending $30 billion a year. Even Netflix is spending $20 billion a year."
"Guess what the Walt Disney company has," she continued. "One hundred years of some of the best intellectual property, characters, and film franchises on earth. So to own that in perpetuity would actually lower Apple's cost."
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