Florida is home to Disney's largest theme park complex. According to the Associated Press, "The S&P 500, Wall Street's main barometer of health, slid 3.9% [in mid-June] to 3,749. And so we are going to monitor it very carefully. It's no surprise that you'll hear varying opinions about the company's prospects and whether or not you should buy its stock. When you think about it, Abbott Elementary airs on ABC, then it goes to Hulu. During Igers leadership from 2005 to 2020, Disney expanded its business with acquisitions of blockbuster-producing film studios Pixar, Marvel, Lucasfilm and 21st Century Fox. financial performance of Disney, which is cyclical. Under Iger's 14-year-plus tenure, Disney stock soared more than 400%, or about 12% annualized. Media and . Some investors may adopt a wait-and-see approach. The Walt Disney Company ( DIS -1.07%) is the subject of a wide range of opinions. It also spent less in . Its expected to turn a profit in 2024. Bear in mind that analyst views can be wrong, and that there are many factors that drive the companys stock price. The 64 analysts offering price forecasts for Walt Disney. These fans then go on to further engage with the MCU through theater releases and content-based products. Type a symbol or company name. Outsmart the market with Smart Portfolio analytical tools powered by TipRanks. Growth followed, with Disney adding 12.4 million subscribers in the third quarter ending July 3. Disney has grown its revenue and operating income steadily since 2020 despite various headwinds. Capital Com is an execution-only service provider. Localized content can drive worldwide subscriber growth. In addition, Disney announced solid earnings, with an increase in revenue and beating EPS estimates for the fiscal Q1:2023. Discovery. ESPN remains the premier domestic sports television network due to its extensive sports programming. The services algorithm-driven forecasting system said the stock is an acceptable long-term investment. The information and content are subject to change without notice. It's hard to believe the $172 billion market cap behemoth started out in 1923 as Disney Brothers Cartoon Studio, by Walt and his brother, Roy O. Disney. have dropped nearly 15% so far in 2022. Source: FactSet. However, the streaming business remains cash-intensive with Disney ramping up content spending by $8 billion this year to support its Direct to consumer offering, while projecting that the business will only be profitable in 2024. Disney is not a buy right now. Stock Price Forecast. Since 2020, the House of Mouse's free cash flow has declined from $2.6 billion to $94 million in 2022. That's nearly 22% below the high set on Jan. 3.". Management said that range will now be higher, as they ramp up spending on local and regional content. Fourth-quarter revenue rose to $20.15bn from $18.53bn a year ago, but was 4.5% lower than consensus estimates polled by Zacks.com. Disney reported Q3 revenue of $17 billion, up 45% year over year, and earnings per share of $0.80, beating estimates of $0.55. In the fourth quarter of 2022, Parks & Experiences booked revenue of. Shares of Disney are down nearly 25% this year, making it one of the worst Dow stocks. We expect that Iger will unwind some of the major changes put in place by Chapek. Despite strong first-quarter results, Wall Street analysts have very different views on varying parts of the . Stronger revenue from Disneys Parks & Experiences segment helped to cushion losses from the DTC. There are several potential catalysts that could lead to higher share prices, including the announcement of a new CEO in the next 18-24 months (If the new CEO has the same credibility Iger has), potential growth in streaming by gaining market share, a rationalized pricing policy, cost cuts, the success of a new blockbuster show due to increased creativity, lower debt levels, keeping ESPN and buying the rest of Hulu, and, most importantly, having activist managers advising and standing behind Iger. Thats a perfect example how the linear platforms, while they still have an audience and could help us monetize can still be used effectively, and we have that ability. Moreover, Disney is also sacrificing its lucrative licensing revenues as it moves back content from third parties to its in-house streaming business. I am not receiving compensation for it (other than from Seeking Alpha). In the sites Disney stock forecast for 2023, Wallet Investor projected the stock to trade at $108.72 in December 2023. However, Disney's stock rallied to a high of $118.18 on 2/9/2022 and closed the day at $110.36. View the latest Walt Disney Co. (DIS) stock price, news, historical charts, analyst ratings and financial information from WSJ. The content is distributed by a single organisation across three significant lines of business: Linear Networks, Direct-to-Consumer and Content Sales/Licensing. However, using the stock price history, algorithm-based price prediction service. The chart above illustrates how its revenue and operating income remained nearly stagnant for most of 2021, but have shown immense improvement with pandemic reopenings. See our analysis of Disney valuation for more information on whats driving our price estimate for Disney and how its valuation compares with peers. Do Not Sell My Personal Information (CA Residents Only). Revenue for fiscal '21 grew 20% to $72.99 billion. Why I rated Disney (NYSE:DIS) as a Sell in December 2022 is because of weak fundamentals, uncertainty surrounding the return of CEO Bob Iger, competition, and the highly variable financial performance of Disney, which is cyclical. Igers four decades experience working in Disney, including 15 years as CEO, wereexpected to set the strategic direction for renewed growth, the company said in the statement. The stock also remains down by almost 50% from highs seen in 2021. Following Disney (NYSE: DIS) and its escapades over the past few years has been at least as exciting as paying money to see one of its blockbuster films. Disneys chief financial officer Christine McCarthy said during the earning call on8 Novemberthat she believed the losses in Direct-to-Consumer had peaked. Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. In 2020, Disney pleased its shareholders with around 25% stock return. Just like in the MCU, Disney uses these films to generate other sales-generating products and experiences like toys, video games, books, and theme park rides. The site suggested the stock could reach $118.328 in three years, according to its Disney stock forecast for 2025. John Ballard owns Netflix and Walt Disney. The parks segment has recovered well, with revenue nearly doubling year over year in the fiscal fourth quarter. Copy and paste multiple symbols separated by spaces. The US Consumer Price Index (, revenue growth of 9% and 23% for the fourth quarter and the full fiscal year 2021/2022 ended 1 October 2022 respectively, the company announced on, Fourth-quarter revenue rose to $20.15bn from $18.53bn a year ago, but was 4.5% lower than consensus estimates polled by, A closer look at its segments reveals that revenue from Disney Media and Entertainment Distribution fell 3% year-over-year (, Disneys chief financial officer Christine McCarthy said during the earning call on. That legislation gave Disney taxing power over the 25,000 acres it had bought up so it could build roads, power plants, and water and sewage systems, using money it collected from itself through property taxes within the district boundaries. Some of the highlights are new CEOs, old CEOs, complete stops to some of its businesses, skyrocketing streaming, huge losses, and fabulous rebounds. The streaming industry, in general, has been facing headwinds as people consume less content online as the economy opens up post-Covid. For 2023 fiscal year, Disneyexpected to spend cash content in the low of $30bn and $6.7bn of capital expenditure, up from $5bn in the 2022 fiscal year, McCarthy said. DIS . Disneys flagship Disney+ - which was a big driver of Disney stock in recent years - saw subscriber additions hold up better than rivals, with the company adding 7.9 million subscribers over the last quarter, compared to Netflix Capital Com Online Investments Ltd is a limited liability company with company number 209236B. Revenues from Disneysstreaming services, including Disney+ and Hulu, under Direct-to-Consumer & International, jumped 41% in the fourth quarter of 2020 to $4.9bn and 81% to nearly $17bn for the fiscal year 2020 ending 3 October. Iger is getting his ducks in order in his third transformation. He revamped the theme parks, brought Star Wars, Marvel and Pixar into the company's movie universe, and launched Disney+. Our priority is the enduring growth and profitability of our streaming business. Iger has already answered the second question by tweaking the internal structure and organizing Disney into three core business segments as follows: Iger has no plans to sell ESPN and should not sell Hulu. That's nearly 21% potential upside. The acquisition included Foxs renowned film production business Twentieth Century Fox, as well as Foxs interests in streaming service Hulu, which helped the company to compete with rival streaming titan Netflix. The earnings number also surpassed the . There were two more 2 for 1 stock splits shortly after in 1977 and 1973. If you rely on the information on this page then you do so entirely on your own risk. The difference between trading assets and CFDs. The name was changed to The Walt Disney Studio at Roys suggestion. It earns the largest affiliate fees per subscriber of any cable channel and generates cash from advertisers looking to reach adult males aged 18 to 49, a critical demographic. Shareholder percentage totals can add to more than 100% because some holders are included in the free float. Analysts now see the stock, which has languished all year, to hit 145.51 in 12 months. Disney Parks, Experiences and Products segment sales jumped 70% to $7.4 billion in Q3. Despite the recent concerns in the streaming industry, we think Disney stock looks like a buy for a couple of reasons. 2022 highest-grossing films by parent company. Its clear that some of our pricing initiatives were alienating to consumers. Yield investors in Disney now have more choices for income than just Disney stock. However, Disney's stock rallied to a high of $118.18 on 2/9/2022 and closed the day at $110.36. Disney still has a mountain to climb to get its flagship streaming service, Disney+, to profitability, especially after taking a step back in its latest quarter by losing 2.4 million subscribers. Dow Jones Falls; Nextracker IPO Pops 50%; Waitlist For Microsoft's Web Transforming AI Grows As GOOGL Market Cap Crashes $173 Bil, Disney Earnings Top, Disney+ Subscribers Fall; Iger Cuts 7,000 Jobs; Peltz Ends Proxy Battle, Stock Market Hits Brick Wall; DraftKings Makes Leaders List, Dow Jones Rallies 250 Points After Jobless Claims; Disney Surges On Earnings. Disney+ added 14.4 million subscribers for a total of 152.1 million, above views. Currently, DIS is trading at an EV-to-EBITDA multiple of 18.46, which is the highest among its peers. Disney Channels programming is made up of internally developed hits based on Disneys extensive library of feature films and animated characters. All rights reserved. Chart by author. It actually lost subscribers in the fourth quarter, and losses were still staggering. Still, considering the company's present measures as well as the past glory, the market is bullish about the stock and feels it might rally again in 2022.The Walt Disney Company, popularly. Disney is not short of growth opportunities heading into 2022. Three are sequels in a franchise (Indiana Jones and the Dial of Destiny, Guardians of the Galaxy Vol. But it needs to find a balance between streaming and in-person revenue. However, it was still way above the inflation target of 2%. Always conduct your own due diligence by reviewing the most recent analyst commentary, Disney stock news, technical and fundamentals analysis. That makes Disney one of the worst . On 10 November, Disney reinstalled Robert A. Iger as chief executive officer as Chapek stepped down. In addition, rising US inflation started to bite into household spending around the time when streaming services, including Netflix, raised their subscription fees. This top entertainment stock should bounce back in 2022. Disney has fully jumped on this bandwagon and is creating content for big screens and small screens to keep Marvel fans happy and engaged. On the retail operation, the company sells Disney, Marvel, Pixar and Lucasfilm-branded products through retail stores and internet sites globally. Wall Street analysts do not provide long-term Disney share price projections. The reopening of Walt Disney's (DIS -1.07%) theme parks and growth from its three streaming services (Disney+, Hulu, ESPN+) wasn't enough to push the stock higher in 2021. -2.08%. So is Disney a buy? It earned adjusted earnings of $1.09 a share on revenue of $21.5 billion vs. S&P Global Market Intelligence forecasts for $0.99 on $21.0 billion. The DMED segment encompasses the company's global film and episodic television content production and distribution activities. Currently, Disney owns about 67% of Hulu. BREAKING: Salesforce Soars Late, Tesla Doesn't Unveil New EV. And reopening movie theaters are boosting prospects for box-office sales. I am not receiving compensation for it (other than from Seeking Alpha). Disney Parks, Experiences and . DIS closed at $138.72 as of March 28, 2022 is -32% below its all-time peak. The reopening of Walt Disney 's ( DIS -1.41%) theme parks and growth from its three streaming services (Disney+, Hulu, ESPN+). The Motley Fool has positions in and recommends Walt Disney and Warner Bros. Some of the major properties licensed by the company include: Mickey and Minnie Mouse, Star Wars, Frozen, Disney Princess, Avengers, Spider-Man, Toy Story, Disney Classics, Winnie the Pooh and Cars. *Average returns of all recommendations since inception. Here it stacks up against any other studio that had a top-10 film in 2022, which includes Paramount , Universal , and Warner Bros. The recent rally, though, shows promise. Since reaching an all-time high closing price in March 2021, Disney stock has been spiralling down to below its pre-pandemic level. But Disney typically outperforms other media companies in ticket sales in any given year. However, recent reports state Bob Iger has asked the board to reinstate the dividend by the end of 2023. He ultimately reached an agreement with the Disney Board, which added an ally to the Board. 2009 was a tough year for Disney and the market as a whole. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Per capita spending in Disneys parks has also soared by 40% in Q2, versus the same period in the pre-pandemic era, indicating that these assets could emerge stronger than pre-pandemic levels, generating sizable cashflows for Disney and potentially masking some of the impacts of rising content investments. Please disable your ad-blocker and refresh. And that compounds the problem of real-world inflation for Disney, which said it spent $3.6 billion on capital expenditures in the past fiscal year and will increase that by $2.5 billion in 2022 . At the time, the company said the move would conserve about $1.6 billion in cash based on the $0.88 a share it last paid. And no, 2022 wasn't an exceptional year. Bear in mind that past performance does not guarantee future results, and never invest or trade money that you cannot afford. of $0.30 in the fourth quarter, down from $0.37 in the prior-year quarter. The major market events for the week ahead right in your inbox. Which outpaced the drop of many other non-tech stocks which fell about half the amount during that time. But the company kept growing. It should be noted that conditions have already begun to change. Consider Disney's 2022 film slate versus its competitors. You should conduct your own due diligence, and never invest or trade money you cannot afford to lose. Cost basis and return based on previous market day close. Read on to find out. Shareholders seemed most excited about the new streaming forecasts, as the company now expects to reach . The Motley Fool has positions in and recommends Netflix, Walt Disney, and Warner Bros. Activist investors continue to play a cooperative role. Over Q2 FY22, Disneys Parks, Experiences, and Products segments results came in ahead of expectations at $6.7 billion, marking an increase of 110% year-over-year, despite this being a seasonably weak quarter which also saw a surge in omicron-related Covid cases. (read more). As noted earlier, fiscal '21 EPS rose. Finally, Disney made a decision to work on its pricing strategy. UPDATE: Disney stock values have continued to drop. The landscape looks a lot different these days, but some things never change, such as James Cameron's stunning ability to create incredible sales-generating films, and Disney's ability to find people like him and churn out new hits from reliable franchises. . Invest with Trefis Market Beating Portfolios. It's one of Pixar's only bombs. But now it's trying to find its footing. We capture key trends in the Dow during and after major market crashes in our interactive dashboard analysis, Market Crashes Compared.'. The latter has expanded very successfully across international markets based on its focus on producing local language content. The stock trades at about 27x consensus 2022 earnings and a little over 20x ZRX 2023 earnings. Walt Disney's (DIS) theme parks are bustling again following a long slow period during the pandemic. Google Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Its "Lightyear" film opened to disappointing results. We value Disney stock at about $190 per share, which is roughly 70% ahead of the current market price. Disney is nearly doubling its content releases from top brands like "Star Wars" in fiscal 2022. A 66 Earnings Per Share Rating reflects a three-year earnings growth rate of -35%, which includes a 19% decline in fiscal '19 and a 65% drop in fiscal '20. Disney is much more than Marvel. The average Disney stock price prediction forecasts a potential upside of 28.69% from the current DIS share price of $101.68. ( Indiana Jones and the market as a whole Networks, Direct-to-Consumer and content subject! Our interactive dashboard analysis, market crashes Compared. ' $ 138.72 as March... Whats driving our price estimate for Disney and the market as a whole and analysis. 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