Disney stock certificates off to Never Never Land
Oct. 09, 2013
NEW YORK (AP) — Disney's paper stock certificates are heading off to Never Never Land.
The stock certificates, with images of Mickey Mouse, Dumbo and Tinker Bell on them, have long been collector's items and a fixture in many children's bedrooms. They are a popular gift among parents, grandparents, uncles and aunts who want to teach kids about the stock market.
But The Walt Disney Co. said Tuesday that it will stop issuing the paper stock certificates to shareholders on Oct. 16.
It's sad news for collectors who covet everything Disney. But it's not shocking to those that watch the stock market. U.S. companies have been switching to electronic stocks from paper ones for years in order to cut costs.
Still, the news came as a surprise to Rick Roman.
"We thought Disney would be one of the last ones to make that shift," said Roman, who owns GiveAShare.com, a website that sells stock certificates.
The Disney certificate has been the company's best-seller since he founded GiveAShare in 2002. "It's the best-looking one around," Roman said. "It appeals to kids." In the center of the certificate is a black-and-white picture of a smiling Walt Disney, the media company's founder. He is surrounded by colorful drawings of Donald Duck, Pinocchio, Bambi and other well-known Disney characters.
GiveAShare sells the stock in a black frame for $146. A Disney share on the New York Stock Exchange was worth nearly $64 on Wednesday.
Sales of the Disney certificate have jumped ten times higher since the news broke late Tuesday, Roman said. He would not provide specific numbers.
Erin Benge, a travel agent, has two Disney certificates hanging in her Houston home. One is in the bedroom of her 3-year-old son Austin. It matches his Mickey Mouse sheets, curtains and posters. His 7-year-old sister Keira has one too. It's hanging in her Tinker Bell-decorated room.
Benge bought the stock certificates when each child was born, paying around $100 for each. "I wanted something unique," she said. "Not just a blanket or a pillow. Something that could be passed down."
She became a Disney fan after her honeymoon at Walt Disney World in Orlando, Florida, in 2001. The family visits the theme park every September.
Benge is bummed she won't be able to buy the certificates for any future relatives.
"I think, personally, they are making a bad call," she said.
Disney said that instead of the stock certificate, they are offering shareholders "certificates of acquisition," if they ask for them. But they'll hold no value.
"It's worthless," said Bob Kerstein, the founder of Scripophily.com, which buys and sells collectable stock certificates. "It's basically a 'thank you' for buying it."
Roman agrees. "I would rather have the authentic stock certificate," he said. But Roman expects there to be demand for the new certificates, especially if there are images of famous characters on them.
Companies have been eliminating paper stock certificates to cut costs. The certificates have stamps and engravings on them to prevent fraud, and the paper is thicker, Kerstein said. That can get expensive. Fixing a typo or transferring ownership of the stock also adds to costs.
Bank of America Corp. stopped offering paper stocks in August to cut costs, said spokesman Jerry Dubrowski.
After Disney stock vanishes next week, Kerstein expects them to become collectibles.
When the Pixar animation studio was bought by Disney in 2006, collectors rushed to buy Pixar's printed stock certificate, Kerstein said. It had drawings of its famous characters on it, including Woody and Buzz Lightyear from the "Toy Story" movies. Today, Scripophily.com is selling a Pixar stock certificate for nearly $600. (Pixar shares were trading near $60 before Disney bought it.) The certificate has gotten more valuable because it has a signature of Pixar's CEO at the time, Apple Inc. founder Steve Jobs, who died in 2011.
There are other child-friendly paper stocks left that parents can buy. Paper stock of DreamWorks Animation SKG Inc., the animation studio, has a drawing of Shrek on it, the green ogre from its popular movies.
Still, Disney was always a favorite.
First the government shut down, Kerstein said, and then Disney stopped issuing its paper stocks. "What's this world coming to?"
Follow Joseph Pisani at http://twitter.com/josephpisani