Although the global recession has taken its toll on the leisure and entertainment industry and its exchange traded funds (ETFs), it isn’t all gloom for the industry.
Walt Disney (DIS) has been hit hard by the decline in consumer spending, jumps in unemployment and an overall desire to save that extra penny. The entertainment giant has slashed an undisclosed number of workers and plans to consolidate its operations in Florida and California, states Reuters.
Starbucks (SBUX) has been hit hard as well closing many stores in the United States. However, it isn’t all bad for the coffee shop chain: they are planning on expanding heavily in London. The reason behind this expansion across the pond is because the company can pick up key retail sites at bargain prices, states Rupert Neate for Telegraph UK.
In an attempt to gain more market share and cut costs, Ticketmaster (TKTM) has been lobbying federal government officials to convince regulators to allow a proposed merger with concert giant Live Nation (LYV). TKTM is also trying to get certain states to outlaw presale tickets, to enable the company to gain a competitive advantage over ticket brokers and other sellers because they will be one of a very few that will know exactly how many tickets are available for specific venues, states Alfred Branch Jr. of Ticket News.
In tough times like these, many leisure items are the first to go, making it no surprise that the sector has seen its fair share of struggles.
The PowerShares Dynamic Leisure & Entertainment (PEJ) is down 1.7% year to date. SBUX is 5.2%, DIS is 3.7%; TKTM is 3.4%
Kevin Grewal contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.