The days are numbered for smokers and owners of stroller wagons and other super-sized strollers at Walt Disney‘s (NYSE: DIS) domestic theme parks. New restrictions that kick in on Wednesday will eliminate designated smoking areas from all six of the Disney World and Disneyland parks in Florida and California. Guests wishing to smoke or vape will have to exit the park. Stroller wagons and traditional strollers that are longer than 52 inches or wider than 31 inches will also not be allowed into the gated attractions.
Disney announced these polarizing changes a month ago. Smokers aren’t happy, and some young families are also not pleased with the selective stroller ban. However, there are also anti-smoking activists and parkgoers with bruised ankles applauding the move. Investors and theme-park fans alike are wondering if the bans will hurt or help Disney’s business. The moves probably won’t have much of an impact in either direction, but let’s size up the pros and cons of the matter.
Continue Reading Below
Ban on the run
Disney stock has been on fire since the new in-park restrictions were announced a month ago today. The shares have soared 27% in that time. However, the new bans have little to do with the reawakening. The Disney+ media event has been playing the role of Prince Phillip planting a kiss on Sleeping Beauty‘s Aurora, and the apparently well-earned Avengers: Endgame buzz is building on those record highs.
Still, Disney’s parks and resorts segment has been its most consistent producer over the years, and it’s expected to be an even bigger player once Star Wars: Galaxy’s Edge opens in the coming months on both coasts. Theme parks also serve as the ideal platform to promote franchises that benefit Disney’s other operating segments.
The new bans weren’t easy decisions, but Disney typically knows what it’s doing. It wouldn’t be inconveniencing smokers if it didn’t think the benefits would result in more incremental visitors. Growing attendance at Disney’s parks makes it more challenging for visitors to navigate their way around big strollers, and it doesn’t hurt that Disney’s there to offer rentals that comply with the new size restrictions. Disney World collects $15 a day for strollers and $31 for double strollers, but it offers discounts for multi-day rentals.
We’ll find out soon enough if the new restrictions are hurting or helping attendance at Disney World in Florida and Disneyland in California. Disney offers insight on theme-park revenue, operating profit, and even hotel occupancy levels in its quarterly reports. But we may never get a true snapshot of the ban’s impact on the business. The timing of the Easter holiday will eat into the current quarter’s numbers, and then we’ll see a Star Wars: Galaxy’s Edge bump through the next few reporting periods.
Advertisement
It’s only if attendance and revenue starts to slip that Disney would consider backtracking on its new policy moves, and that just doesn’t seem likely, given the healthy momentum for the world’s largest theme-park operator.
5 Simple Tips to Skyrocket Your Credit Score Over 800!Increasing your credit score above 800 will put you in rare company. So rare that only 1 in 9 Americans can claim they’re members of this elite club. But contrary to popular belief, racking up a high credit score is a lot easier than you may have imagined following 5 simple, disciplined strategies. You’ll find a full rundown of each inside our FREE credit score guide. It’s time to put your financial future first and secure a lifetime of savings by increasing your credit score. Simply click here to claim a copy 5 Simple Tips to Skyrocket Your Credit Score over 800.
Rick Munarriz owns shares of Walt Disney. The Motley Fool owns shares of and recommends Walt Disney. The Motley Fool has a disclosure policy.
