Disney makes the right pick to lead board as it searches for next CEO

Disney on Monday provided an encouraging update on its plans to find a successor to veteran CEO Bob Iger. The news Disney announced Monday that James Gorman, the former CEO of Morgan Stanley , will be elevated to chair of the board in January, replacing Mark Parker, the executive chairman and former CEO of Nike . In the same update, Disney said it aims to announce Iger's successor in early 2026. Iger's CEO contract currently runs until Dec. 31, 2026. Gorman joined Disney's board earlier this year and in August was named the lead of Disney's succession planning committee, which is tasked with finding Iger's replacement. Gorman will continue to head that committee as board chair. Gorman also currently serves as the executive chairman at Morgan Stanley, but he will step down from that role at year-end. Big picture Disney shareholders are closely watching the company's efforts to replace Iger for a second time in recent years because the first attempt didn't go so well. Iger was rehired as CEO in November 2022 after less than three rocky years for his initial successor Bob Chapek. Disney extended Iger's contract by two years in July 2023 , buying the company more time in the leadership transition. Iger delayed his retirement on multiple occasions during his first stint as CEO, which ultimately lasted from 2005 to early 2020. In Nelson Peltz's unsuccessful proxy fight earlier this year, the activist investor took issue with how Disney's board previously handled succession. Shares of Disney were down about 1% Monday amid a down day for Wall Street overall. The stock, which has underperformed the market this year, closed Friday above $97 a share for the first time since July. DIS .SPX YTD mountain Disney's year-to-date stock performance versus the S & P 500. Bottom line Disney is in good hands with Gorman at the helm of its board. Jim Cramer on Monday expressed admiration for Gorman and his successful tenure at fellow Club holding Morgan Stanley, which included a major push into wealth management. Jim said Gorman's strategic expertise will be crucial as Disney navigates the transition and pursues its long-term growth initiatives. "I have been a Gorman fan for a long time," Jim said Monday on CNBC, noting that Gorman has familiarity with succession planning. Gorman's 14-year tenure as CEO of the Wall Street bank ended last year. The firm's new CEO, Ted Pick, has "reaped some of the great success of Gorman," Jim added. Morgan Stanley shares soared to all-time highs last week after it reported top and bottom-line beats for its third quarter . While early 2026 to name Iger's replacement may seem far away, Jim said there is "no need to rush" picking the right candidate given that Disney's businesses are in a solid footing – for the most part. Disney's combined streaming, which includes Disney+, Hulu and ESPN+, reported its first-ever quarterly profit in the third quarter on Aug. 7. Meanwhile, its recent film slate has found success at the box office with movies such as "Inside Out 2" and "Deadpool & Wolverine." The main issue right now is theme park attendance, which has moderated as consumers continue to be cautious around spending. In its August earnings report , management warned that revenue for its experiences division would be flattish in the three months ended in September, with a similar dynamic affecting the next few quarters. Nevertheless, the long-term future of Disney's parks business, a key profit driver for the company, looks strong. Disney is wisely investing in its domestic and international parks over the next decade to ensure there's new attractions visitors want to see. During the October Monthly Meeting, Jim said the Club would consider adding to its stake in Disney if the stock drops below $90 a share, a little over 6% below Monday's intraday levels.

Disney on Monday provided an encouraging update on its plans to find a successor to veteran CEO Bob Iger.