2 Incredible Stocks I'm Buying in the Stock Market Downturn

Group 1: Walt Disney - Walt Disney has faced challenges in achieving profitability in its streaming business and has potentially overvalued its theme parks without sufficient investment in customer experience [3] - In the most recent quarter, Disney's revenue increased by 5%, with operating income and adjusted earnings per share growing by 31% and 44% respectively, attributed to management's focus on efficiency [4] - Disney is currently trading at its lowest price-to-sales multiple since the financial crisis, approximately 30% below its recent high, presenting a potential entry point for long-term investors [5] - For the current fiscal year, Disney anticipates about $15 billion in operating cash flow and$3 billion in buybacks, with a long-term investment plan of $60 billion in its parks over the next decade [6] Group 2: Starbucks - Starbucks experienced a significant stock rally in August 2024 with the announcement of Brian Niccol as the new CEO, but the stock has since fallen by 30%, reaching its lowest price since before his hiring [7] - Niccol has initiated a turnaround plan called "Back to Starbucks," which includes simplifying the menu, reducing wait times, and enhancing the in-café experience, showing promising early results [8] - The latest earnings report exceeded analyst expectations, although comparable sales saw a slight year-over-year decline; however, key customer-related metrics improved on a sequential basis [9] - Starbucks is currently trading at a historically low price-to-sales ratio, and if the turnaround efforts succeed in revitalizing growth and improving margins, the current price may represent a bargain for long-term investors [12] Group 3: Tariff Risks - Both Walt Disney and Starbucks are significantly exposed to China, with Starbucks operating nearly 7,600 stores in the country, representing about 19% of its total [13] - Both companies are cyclical and depend on consumer spending, which could be adversely affected if tariffs lead to inflation or a recession [14] - Despite the risks, both companies are viewed as attractive long-term investments, with the potential for steady growth over the years [15]