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Walt Disney’s Earnings to More Than Double in Q1


Walt Disney, a family entertainment company, is expected to report its fiscal first-quarter earnings of $0.68 per share, which represents year-over-year growth of over 112% from $0.32 per share seen in the same period a year ago.

The family entertainment company would post revenue growth of over 30% to $21.15 billion. The company has beaten earnings estimates in most of the quarters in the last two years, at least.

“From our last report, the stock price has declined by 20% to $140.03 from $175.48 in Oct’21. The decline in the most recent quarter was due to higher market expectations for subscribers, which did not pan out for the company in the most recent quarter, as the company ended the fourth quarter and fiscal year with over 118mn global paid Disney+ subscribers, reflecting over 2mn net additions from Q3FY21,” noted Shejal Ajmera, Head of Research at Crispidea.

“The company has given guidance on reaching in range of 230-260mn paid Disney+ subscribers globally by the end of the fiscal year 2024. We anticipate that if the company meets or exceeds this guidance, it will gain investor trust in terms of subscription revenue generated by the company, as more paid subscribers lead to more revenue for Walt Disney.”

Walt Disney stock traded 0.73% higher at $142.02 in pre-market trading on Monday. The stock slumped over 8% so far this year after falling more than 14% in 2021.

Analyst Comments

“Disney is building content assets that enable it to take advantage of the significant direct-to-consumer streaming opportunity ahead. Disney’s underlying IP remains best-in-class, supporting long term content monetization opportunities,” noted Benjamin Swinburne, equity analyst at Morgan Stanley.

“During this period of FCF pressure from Parks closures, ESPN’s FCF generation is key to driving down leverage. Historical cycles suggest a potential return to above prior peak US Parks revenues in FY23.”

Walt Disney Stock Price Forecast

Twenty-one analysts who offered stock ratings for Walt Disney in the last three months forecast the average price in 12 months of $194.05 with a high forecast of $229.00 and a low forecast of $165.00.

The average price target represents a 36.64% change from the last price of $142.02. Of those 21 analysts, 14 rated “Buy”, seven rated “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price to $170 with a high of $215 under a bull scenario and $105 under the worst-case scenario. The investment bank gave an “Overweight” rating on the entertainment company’s stock.

Several other analysts have also updated their stock outlook. MoffettNathanson lowered the target price by $10 to $165. Guggenheim cuts the target price to $165 from $205. Wells Fargo cut the target price to $196 from $203.

Technical analysis suggests it is good to sell as 100-day Moving Average and 100-200-day MACD Oscillator signals a strong selling opportunity.

Check out FX Empire’s earnings calendar

This article was originally posted on FX Empire


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