CNBC’s Jim Cramer said on Monday that he remains faithful disney after the company welcomed Bob Iger as chief executive.
“Disney is the defining story of the day. It’s a great example of how you can stick with an iconic company…and make money when they bring in a better leader. And that’s exactly what I see happening as Iger takes the helm,” he said. said.
The company announced Iger’s return as chief executive on Sunday, effective immediately. The move reportedly came after senior company executives complained that former CEO Bob Chapek was unsuited for the job.
Shares of Disney closed up 6.3% on Monday.
Cramer called for Chapek to be fired earlier this month after the company reported wide misses in fourth-quarter earnings and revenue, in part due to mounting losses in its direct-to-consumer segment. He also criticized the former Disney executive for not taking responsibility for his mistakes during the company’s post-earnings conference call.
“It was frankly shameful,” he said.
And while he’s pleased with Iger’s return, Cramer reminded investors that there’s still work to be done for the company to cut costs and prioritize profitability, particularly when it comes to leasing. company’s streaming business.
“Iger has set high profitability targets for Disney+. It’s time to reset those targets to more realistic levels,” he said, adding, “Iger has to say that profitability is what really matters here, not subscriber growth.”
Disclaimer: Cramer’s Charitable Trust owns Disney stock.