Our articles on the topic of “Is this Stock Halal” are getting a lot of interest from our readers. A lot of Muslim investors are finding answers to their questions. Moreover, these articles help Muslim investors to make the right investment choices without compromising their faith and this is what our main goal is. We got a request for the article “Is Walt Disney Stock Halal?” and our team and financial analysts brought the results for you. You can find an accurate answer to your question in the following article. Our main criteria are:
- The impermissible business activity should be less than 5%
- Interest-bearing debt to company’s market capitalization should be less than 30%
- Interest-bearing securities to company’s market capitalization should be less than 30%
The Walt Disney Company, together with its subsidiaries, is a global entertainment company. The company operates in the sector of Disney Media and Entertainment Distribution and Disney Parks, Experiences, and Products. Although the products are attractive, Muslim investors wonder if Walt Disney Stock Halal?
Walt Disney’s Business
Stock – Walt Disney
Ticker – NASDAQ: DIS
Sector – Communication Services
Compliance Status – Questionable
The Walt Disney Company is a multibillion-dollar entertainment company. Media Networks, Parks, Experiences and Products, Studio Entertainment, Direct-To-Consumer (DTC), and International are the company’s four main segments. Furthermore, cable and broadcast television networks, television production and distribution businesses, domestic television stations, and radio networks and stations are all part of the media networks segment. Theme parks, resorts, Disney Cruise Line, and Disney Vacation Club are among the company’s Parks and Experiences. Motion film production and distribution, live entertainment event creation, production, and licensing, and music production and distribution are all part of the studio entertainment business. Lastly, Its DTC operations include video streaming subscription services for general entertainment, family, and sports programming.
Financial Screening
Firstly, we check business activity to know if Walt Disney is Shariah-Complaint. The company’s revenue mainly comes from onscreen entertainment. Disney also makes money from the following sources:
- theme parks and resorts management
- variety of products manufacture
| Non-Islamic business activities | 0.21% |
| Revenue from questionable segments | 94.29% |
Even if there is nothing inherently haram in the company’s products, some of the hidden message broadcasted in the company’s films and TV series violates Shariah rules and affects the halalness of the company.
Secondly, we screen its interest-bearing debt ratio. The debt amount should not exceed 30% of its market cap. In the case of Walt Disney, the percentage of interest-bearing debt is 21.30% of its market cap. So, we can conclude that it meets the criteria.
| Total Debt | 54.69B |
| 36 Month Average Market Capitalization | 256.76B |
Finally, we screen the interest-bearing securities ratio. Walt Disney’s interest-bearing securities account for 6.22%. The number of securities that aim to receive interest should not exceed 30% of its market cap. So, it meets the last criteria as well.
| Cash and Interest-Bearing Securities | 15.96B |
| 36 Month Average Market Capitalization | 256.76B |
Despite passing two financial screening requirements, Walt Disney generates more than 5% of its total income from unknown commercial operations. As a result, from a Shariah perspective, Walt Disney stock is one of the questionable stocks, and Muslim investors should avoid investing in such questionable assets that cannot be confidently described as halal.
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