Netflix’s stock (NFLX) has plunged more than 40% this year, ahead of its first quarter earnings release after the closing bell Tuesday. Meanwhile, shares of Disney (DIS) have dropped nearly 15% so far in 2022. That makes Disney one of the worst performers in the Dow, which is down just 4% this year.

Inflation is a problem, too. A recent report from the United Kingdom showed that consumers are cutting back on streaming services due to worries about rising prices, and UK customers were dropping Disney+ at a faster rate than Netflix and Amazon’s (AMZN) Prime Video. (Disney also owns Hulu and the sports streaming service ESPN+.)

Despite Disney’s massive library of movies and shows thanks to its own branded studio, as well as Marvel, Pixar and Star Wars creator Lucasfilm, investors are worried that this abundance of content won’t boost streaming subscription growth enough to offset slowdowns in its traditional broadcast and cable TV businesses.

“Disney+, Hulu, and ESPN+ have the scale and management conviction to over time be a massive global streamer,” said JPMorgan analyst Philip Cusick in a report Tuesday. But he added that “this isn’t necessarily as good a business as Disney used to have in TV.”

Traditional media companies like Disney used to rely a lot more on lucrative advertising sales and affiliate fees from cable companies to carry their channels, but the shift to streaming has upended that model. Investors now are more interested in streaming margins and not merely the bragging rights that come from how many subscribers a company has.

“The market appears to be moving past rewarding media companies, as it did in 2020 and 2021, simply for their forecast of future streaming subscriber growth,” said MoffettNathanson analyst Michael Nathanson in a report last month.

“Now it seems that investors are looking further down the income statement — and also, finally, digging through the cash flow statement — to try to determine the underlying steady state profitability of the pivot to Direct-to-Consumer content delivery,” Nathanson added.

Nathanson lowered his price target on Disney in March from $165 a a share to $150 due in part to worries about lower profit margins.

Florida controversy still an issue for Disney

Whether or not the Florida controversy is having an actual impact on Disney+ subscriptions, movie and theme park attendance and ratings for Disney-owned ABC and ESPN is up for debate.

However, one analyst noted that the “Don’t Say Gay” issue could also hurt the company in another way, if more liberal Hollywood celebrities decide not to work with the House of Mouse.

“The single most important [Disney] asset is its brand, next is its talent. If the controversy leads to a loss of key creative talent, it would clearly be a negative,” said Loop Capital’s Alan Gould in a report earlier this month.

Whatever happens, it’s clear that Wall Street is not happy with how Disney has performed since Chapek took over from Iger in February 2020.

Disney shares are now hovering near their lowest levels since November 2020. To be sure, Chapek was dealt a bad hand since the start of his tenure coincided with the beginning of the Covid-19 pandemic in the United States, an event that led to a dramatic slowdown in tourism and leisure activities like going to see movies.

Disney should have a big 2022 at the box office

But some are hopeful that Disney will be able to soon turn things around.

Michael Morris of Guggenheim Securities wrote in a report late last month that the parks business should rebound thanks to new attractions like “Star Wars: Galaxy’s Edge” and “Avengers Campus,” increased visits from foreign travelers to the flagship resorts in Orlando and California and a full reopening of international parks and cruise lines.

And JPMorgan’s Cusick noted Disney’s strong slate of movies this summer and later this year as a positive.

Box office revenue should start to bounce back thanks to the upcoming releases of sequels for Marvel’s Dr. Strange, Thor and Black Panther, the Pixar movie “Lightyear” about the inspiration behind the popular “Toy Story’ character. Also coming is the highly anticipated first sequel to the 2009 hit “Avatar.” (“Avatar 3” will follow in 2024.)