Fundamentally,
there are four ways that a company can increase shareholder value. The first action to consider
is to increase pricing. You may also increase shareholder value by increasing sales. Decreasing
costs is another factor to consider. A fourth way to increase shareholder value would be
increasing fixed cost utilization, which requires a company to look at ways to use resources
differently to decrease costs and/or increase sales.
As with any company with
multiple revenue sources, you probably want to look at the Walt Disney Companys greatest revenue
source. Currently, the largest percentage of the companys profits come from its media resources,
specifically television. Therefore, you should consider changes that could be made in Disneys
media holdings using the above four components to increase shareholder value as a guide. This
would give the changes the most leverage in impacting the company's profits and value.
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