Walt Disney Stock (DIS:NYE) Analyst Upgrades on Iger return

The Fundamental analysis for Walt Disney stock is a score of 7.1 out of 10. Whereby the stock has got a Bullish outlook.

Walt Disney Stock Forecast

 
Moffett Nathanson upgraded Walt Disney stock to Outperform from Market Perform. He maintained the 12-month target of $120 per share.
 
The analyst bases the upgrade on the company bringing back former CEO Bob Iger. Nathanson states “We applaud Disney’s Board for the courage to make this change”. Nathanson expects Bob Iger to do two things. These are to leverage the company’s existing strengths and drive value in this area.
 

Analysis of the Walt Disney Stock:

 
The average analyst target price for the Walt Disney Company over the next 12 months is USD 122.63. Based on 21 analysts covering the company.
 
Strong Buy is the typical analyst recommendation for the Walt Disney Company. Walt Disney stock has a bullish outlook according to Stock Target Advisor’s research. Based on 10 positive and 4 negative indications.
 
The stock price of the Walt Disney Company was USD 91.80 at the most recent close. The stock price of Walt Disney Company has moved by -3.38% in the last week, -6.89% in the last month, and -40.39% in the last year.
 

Walt Disney Company About (DIS:NYE)

 
The Walt Disney Company runs a global entertainment business along with its subsidiaries. It has two operating segments which are:
  • Disney Media & Entertainment Distribution
  • Disney Parks, Experiences and Products
The company operates television broadcast networks under the names of:
  • ABC
  • Disney
  • ESPN
  • Freeform
  • FX
  • Fox
  • National Geographic
  • Star brands.
 
Studios that make motion pictures under the banner of:
  • Walt Disney Pictures
  • Twentieth Century Studios
  • Marvel
  • Lucasfilm
  • Pixar
  • Searchlight Pictures
It also produces and distributes films and episodic television content. Additionally, it provides theatrical:
  • Home Entertainment,
  • Music Distribution Services
  • The staging and licencing of live entertainment events
  • Post-production services from Industrial Light & Magic and Skywalker Sound
  • Direct-to-consumer streaming services via Disney+, Disney+ Hotstar, ESPN+, Hulu, and Star+.
It also sells and licences:
  • Movie and television content to third-party
  • Subscription video-on-demand services.
 
The business also runs theme parks and resorts like:
  • Walt Disney World Resort in Florida
  • Disneyland Resort in California
  • Disneyland Paris
  • Hong Kong Disneyland Resort
  • Shanghai Disney Resort
  • Disney Cruise Line
  • Disney Vacation Club
  • National Geographic Expeditions
  • Adventures by Disney
  • Aulani, a Disney resort and spa in Hawaii
It licenced its intellectual property to a third party for Tokyo Disney Resort. It provides services like Disney Vacation Club. Additionally, it creates and publishes:
  • novels
  • comic books
  • periodicals

    It sells branded items through retail, online, and wholesale businesses.

 

Fundamental Analysis of DIS’s Stock:

 

Positive Fundamentals:

 

High market capitalization

This organization is among the top quartile and is one of the biggest in its industry. These businesses are typically more reliable.
 

Superior returns on risk

Walt Disney Stock has outperformed its sector rivals on a risk-adjusted basis. Over the course of at least a 12-month holding period in the top quartile.
 

Low volatility

For a hold duration of at least 12 months, Walt Disney Stock yearly returns have been stable. Constant when compared to peers in its industry. They are in the top quartile. Although stability is desirable, it can also restrict returns.
 

High dividend yield ratio

Walt Disney Stock has outperformed its industry rivals over the past 5 years. For a hold duration of at least 12 month. It is in the top percentile in terms of average annual dividend returns. For investors seeking high income yields, this could be an excellent purchase, especially if it is excelling on a total return basis.
 

Excellent return on equity

The management of the company has outperformed its competitors in terms of return on equity over the last four quarters, ranking it in the top quartile.
 

Superior capital efficiency

In the last four quarters, firm management outperformed its counterparts in terms of return on invested capital, putting it in the top quartile.
 

Positive cash flow

The last four quarters saw positive total cash flow for the organisation.
 

Positive free cash flow

The last four quarters saw the company generate positive total free cash flow.
 

Superior growth in earnings

In the preceding five years, Walt Disney Stock profits growth was in the top quartile for its industry.
 

Superior growth in revenue

Compared to its industry, Walt Disney Stock revenue growth over the previous five years has been in the top quartile.
 

Negative Fundamentals:

 

Total returns that are below the median

In terms of annual average total returns during the previous five years, the company lagged behind its competitors.
 

Excessive in comparison to wages

Walt Disney Stock is trading above the sector median and at a premium to its peers in terms of price to earnings.
 

Overpriced based on cash flow

On a price to cash flow ratio, Walt Disney Stock is trading at a premium to that of its competitors. Its pricing is higher than the sector median. Whenever you are thinking about buying, go with prudence.
 

Overpriced based on free cash flow

On a price to free cash flow basis, Walt Disney stock is trading at a premium to that of its competitors. Its pricing is higher than the sector median. Whenever you are thinking about buying, go with prudence.
 

Conclusion of Analysis

 
The Fundamental analysis for Walt Disney stock is a score of 7.1 out of 10. Whereby the stock has got a Bullish outlook.

Disney Inc. (DIS:NYE) Stock falls on Earnings Miss

Disney and Company’s fundamental  score is 6.7 out of 10.

After markets closed on Tuesday November 8th, Disney and Company released their financial results for the fourth quarter of its fiscal year, missing on both the top and bottom lines. The slowdown in global advertising that is plaguing other firms, has hit Disney alongside other macroeconomic issues that weighed on profitability as the corporation also dealt with a much higher than expected churn rate.

Disney and Company’s Quarterly Results:

Revenue: $20.15 billion vs the anticipated $21.26 billion

Adjusted Earnings Per Share: (EPS) were $0.30 versus $0.51 anticipated.

Disney+ subscription net additions: 12.1 million versus the anticipated 9.35 million

Revenue from Traditional Business Units: $7.43 billion vs $7.59 billion anticipated

 

Theh main highlight for the quarter was the net subscriber additions for Disney+ which increased to 12 million, exceeding the forecast of over 9 million. The company had announced a jump in subscribers to 14 million in the third quarter as a result of new market launches and a diverse slate of content.

Company leadership issued a warning statement, revealing that the firm anticipates Hotstar and Disney+ subscription growth will slow down dramatically in the company’s first quarter of the new fiscal year. The company expects that for the entire year in 2023 that the company’s content spending is forecasted to be in the low $30 billion range, which comes to a surprise to analyst and investors alike.

The company lost a combined $1.5 billion at all of it’s streaming divisions, including Disney+, Hulu, and ESPN+ in the fourth quarter (vs. a loss of 1.1 billion in the third quarter). Disney’s Christine McCarthy, the CFO of the entertainment firm, predicted that Disney+ losses would peak this year, with management predicting a $200 million decline in streaming losses in the first quarter of 2023.

Disney’s CEO Bob Chapek stated in the earnings announcement that “we estimate our DTC operational losses to diminish moving ahead and that Disney+ will still attain profitability in fiscal 2024, provided we do not see a major shift in the economic environment.” He also mentions “We think we will be on the path to creating a successful streaming business that will drive continuing growth and generate shareholder value far into the future by realigning our costs and capturing the benefits of price hikes and our Disney+ ad-supported tier coming December 8”.

Despite the company’s recent price hikes in Disney+,  Disney+’s average revenue per user decreased to $3.91 from forecasts of $4.29 due to negative foreign exchange effects and a more diverse member base.

Disney and Company will release its $7.99 ad-supported service for Disney+ in December, just after Netflix’s launch of their AD supported new streaming plan in order to reduce subscription costs for struggling consumers.  Even though AD spending has been dramatically reduced by company’s marketing divisions, analysts remain positive on the profitability and consumer adoption of the new AD supported plans.

As a result of the weakening economic environment, park operations fell shorter than expected.  Disney’s theme parks missed estimates in the third quarter as consumer demand was constrained by recession fears despite swift COVID recoveries brought on by new attractions, price increases, and upgraded technology like the Genie+ app.

Parks, experiences, and consumer goods section of the company reported revenue of $7.5 billion and operating income of $1.5 billion (vs. projections of $1.9 billion). Disney Resort in Shanghai is still closed due to COVID-19 regulations. The Shanghai operations have been closed indefinitely with no scope of when it might reopen.

However, the CFO, McCarthy believes that the company is on track to have a  very strong holiday season, which will kick off the first quarter in a positive trajectory to start the new year of 2023. Executives  highlighted the company’s release of its upcoming film lineup, noting that it expects “Black Panther: Wakanda Forever” and “Avatar: The Way of Water” to be the top two grossing films over that period, which should help to boost revenue, and help expand those franchises.

Disney’s Stock target Forecast & Current Pricing:

Based on the Walt Disney Company stock forecasts from the 21 analysts covering the equity, the average price target for Walt Disney Company’s stock is USD 140.03 over the next 12 months. Walt Disney Company’s average analyst rating is currently set at a  Strong Buy rating. StockTargetAdvisor’s  own fundamental analysis of Walt Disney  is rated at Slightly Bullish , which is based on 10 positive attributes and 5 poor attributes. At the last closing, Walt Disney Company’s stock price was USD 99.90. Walt Disney Company’s stock has changed by -5.73% over this past week,  and is +3.37% over the past month of October and -42.82% for the entire year.  The Crow rating is currently a Buy, with a Crowd target of $134 over the next 12 months.

Disney and Company’s fundamental  score is 6.7 out of 10.

Analysts rate Walt Disney Company (DIS:NYE) with a Strong Buy rating and a $145 target

Credit Suisse maintains the stock rating as to outperform with a $157 Walt Disney stock price target.

Based on the Walt Disney stock forecast from 22 analysts, the average analyst Walt Disney stock price target is USD 145.03 over the next 12 months. Walt Disney Company’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Walt Disney stock forecast is Bullish, which is based on 11 positive signals and 4 negative signals. At the last closing, Walt Disney stock price was USD 112.08Walt Disney stock price has changed by -4.33% over the past week, +5.98% over the past month and -38.91% over the last year.

About Walt Disney Company (DIS:NYE):

The Walt Disney Company, together with its subsidiaries, operates as an entertainment company worldwide. It operates through two segments, Disney Media and Entertainment Distribution; and Disney Parks, Experiences and Products. he company engages in the film and episodic television content production and distribution activities, as well as operates television broadcast networks. It also offers direct-to-consumer streaming services, sale/licensing of film and television content to third-party television and subscription video-on-demand services; theatrical, home entertainment, and music distribution services. In addition, the company operates theme parks and resorts. The Walt Disney Company was founded in 1923 and is based in Burbank, California.

 

What we like:

High market capitalization:

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk adjusted returns:

DIS stock forecast shows that the stock has performed well, on a risk adjusted basis, compared to its sector peers (for a hold period of at least 12 months) and is in the top quartile.

Low volatility:

The stock’s annual returns have been stable and consistent compared to its sector peers (for a hold period of at least 12 months) and is in the top quartile. Although stability is good, also keep in mind it can limit returns.

High dividend returns:

DIS stock forecast shows that the stock has outperformed its sector peers on average annual dividend returns basis in the past 5 years (for a hold period of at least 12 months) and is in the top quartile. This can be a good buy, especially if it is outperforming on total return basis, for investors seeking high income yields.

Superior return on equity:

The company management has delivered better return on equity in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior capital utilization:

The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior return on assets:

The company management has delivered better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile.

Positive cash flow:

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow:

The company had positive total free cash flow in the most recent four quarters.

Superior Earnings Growth:

DIS stock forecast shows that the stock has shown top quartile earnings growth in the previous 5 years compared to its sector.

Superior Revenue Growth:

DIS stock forecast shows that the stock has shown top quartile revenue growth in the previous 5 years compared to its sector.

 

What we don’t like:

Below median total returns:

DIS stock forecast shows that the company has under-performed its peers on annual average total returns in the past 5 years.

Overpriced compared to earnings:

The stock is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced on cashflow basis:

Walt Disney stock price is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

Overpriced on free cash flow basis:

Walt Disney stock price is trading high compared to its peers on a price to free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.