3 Red Flags for Disney's Future

The Walt Disney Company (NYSE: DIS) has had a rough couple of years since the pandemic began. The pandemic forced Disney to temporarily lock all the turnstiles at its theme parks, which caused a significant decline in visitors. Disney World is bouncing back, but it could be a while before it is back to full strength.

Disney investors face some significant red flags: The company has a heavy long-term debt load and could suffer in an inflation-induced recession.

Before the outbreak, Disney already had a substantial debt balance. At the pandemic's onset, Disney borrowed more to ensure it would make it to the other side. The recovery is materializing slowly, meaning it will take more time for Disney to pay down its debt balances. From October 2021 to April 2022, Disney managed to pay down roughly $2 billion in its long-term debt obligations but still held $46.6 billion. You can see the expansion of debt over the long term in the chart below.

Source Fool.com