Iran Peace Signals and Market Volatility: How to Invest When Headlines Move Markets

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**SPEAKER_2** (1:13)
This is InvestTalk from KPP Financial, helping investors make sense of the markets one day at a time. Here's your host, Justin Klein.

**Justin Klein** (1:29)
Good afternoon, fellow investors and welcome back to InvestTalk. This is our, what are we, Wednesday? Wednesday, August 5th, 2026 edition of InvestTalk. A lot of moving parts in markets. We had the big SpaceX earnings last night. We had more chip stock earnings after the bell today. We have SpaceX stock unlocked tomorrow.
Then we have the economy moving in a lot of different directions.
You can color the economy in many ways, depending on which area you want to focus. Our job here is to kind of just fill it all down to a general direction of the economy, what sectors are performing well and not.
Most importantly is just about the fundamentals of investing. Not using your emotions to chase returns or sell when it's down and you panic sell at the bottom. A lot of people do that. They buy high and they sell low because they use emotions. Our job here is to keep your eye on the price and focus on what matters to good, successful decision-making and we do that by answering your finance investment questions. So I encourage you to pick up the phone, give us a call. 888-99-CHART is the number as usual and we will also bring you some topics that I think will further your education, maybe about a particular sector or an asset class or just a way to frame your mind so that you can capitalize on an opportunity or maybe avoid pitfalls. So we're going to do all of that in this hour and in just a bit we'll talk about today's Mark Performance and run down the show topics for the hour. But as usual, we'll tackle this first call question now.

**Mark** (3:18)
Yeah, Mark from San Diego.
Just curious about Disney, DIS. Earnings came out, looked pretty good. Maybe they're coming back from the dead. Anyway, just your thoughts, we appreciate it. Thanks.

**Justin Klein** (3:32)
Looking at Disney, DIS is the symbol.
I'm just trying to pull this up on a separate chart. The earnings must be up 15% this year to $6.82 than the 7.45 next year. So it's certainly trending in the right direction. That's the good news.
Take a look here. RoltaStrength is 31, though. So over the last year, it hasn't done so well from a chart perspective. It has been in a solid downtrend really since the peak last July at $124 per share. Now, we're down to 101 even after the good earnings announcement. Now, I do think it's a pretty good value. Trading at mid to low teens, forward-looking multiple, that's good. However, I think there are some long-term structural challenges with Disney. And that really has to do with the way that kids are consuming content. It used to be all about the movies and not to say that Disney is not part of the landscape of childhood entertainment. But it's getting increasingly crowded out by other avenues, like YouTube, for example. Gaming is big and they're not that big into gaming. That's why they have been trying to acquire things like Star Wars in order to grow their IP in an era where it's becoming more difficult. The media landscape is more fractured.
And so it's harder to get their characters, their stories, in front of more people or more kids, excuse me. So ultimately, that is, I think, an issue. And so I think there's some long-term headwinds there that you have to certainly consider when you're looking at Disney. But like I said, from an earning standpoint, from a valuation standpoint, it is starting to look relatively cheap. $7 billion in free cash flow on a market of $177 billion.
It's not amazing. It's only about a 3% free cash flow yield. So certainly not a bargain or anything like that. But enterprise value to EBITDA around $9.8. Let's see what it historically trades at. This is in the low end of its enterprise value to EBITDA range. That's a good thing. Return equity, though, it's under 11%. That's the issue that I was talking to you about. It's just pre-COVID 2018, the return equity was 26% trending higher really through from the recession, from 1 when it was in the single digits to all the way, like I said, high around 26%. So, its profitability was increasing, but really post-COVID and beyond, it's been pretty meager. So, that is all suddenly, I think, the issue. I think it's a decent value, but it's not the same business as it was.