Sound Shore Fund Believes The Walt Disney Company (DIS) is an Attractive Risk/Reward Holding

Sound Shore Management, an investment management firm, has released its investor letter for the second quarter of 2025. A copy of the letter can be downloaded here. The fund’s Investor Class (SSHFX) and Institutional Class (SSHVX) delivered 3.06% and 3.10%, respectively, in the second quarter of 2025 compared to a 3.79% return for the Russell 1000 Value Index (Russell Value) and 10.94% return for the Standard & Poor 500 Index (S&P 500). Sound Shore’s 35-year annualized returns were 14.92% and 15.14% for SSHFX and SSHVX, respectively, as of June 30, 2025, and were ahead of the Russell Value at 12.76% and trailed the S&P 500 at 19.71%. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Sound Shore Management highlighted stocks such as The Walt Disney Company (NYSE:DIS). The Walt Disney Company (NYSE:DIS) is an entertainment company that operates through the Entertainment, Sports, and Experiences segments.  The one-month return of The Walt Disney Company (NYSE:DIS) was -0.45%, and its shares gained 29.66% of their value over the last 52 weeks. On September 10, 2025, The Walt Disney Company (NYSE:DIS) stock closed at $115.79 per share, with a market capitalization of $208.182 billion.

Sound Shore Management stated the following regarding The Walt Disney Company (NYSE:DIS) in its second quarter 2025 investor letter:

"Technology is also disrupting legacy media and we have discussed in the past how we have resisted the temptation to purchase statistically cheap stocks until the industry winners become clearer. The transition to a digital streaming model continues to accelerate throughout the media industry and the legacy players have been adjusting their strategy and investments to compete. Given its scale and success with a repositioning of its offerings, we believe portfolio holding The Walt Disney Company (NYSE:DIS) is an attractive risk/reward with potential to grow both in the US and abroad. The stock recently hit a new high as the market applauded their plan to launch the flagship ESPN streaming service by end of 2025 and we see further upside from here."

The Walt Disney Company (NYSE:DIS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 111 hedge fund portfolios held The Walt Disney Company (NYSE:DIS) at the end of the second quarter, which was 104 in the previous quarter. While we acknowledge the potential of The Walt Disney Company (NYSE:DIS) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered The Walt Disney Company (NYSE:DIS) and shared the list of top mega-cap stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.