ESPN Is Crowned Jewel But Disney Faces Earnings Pressure, Analyst Says
Portfolio Pulse from Anusuya Lahiri
Needham analyst Laura Martin has reiterated a Hold rating on Walt Disney Co (NYSE:DIS) due to concerns over high consensus estimates, DTC losses, and weak earnings from linear TV and box office. Martin also highlighted the potential downside risk to Disney's valuation due to $60 billion of capital spending at Parks & Resorts. Despite these concerns, Martin believes Disney's asset mix and benefits from generative AI make it a potential takeover target. Disney recently disclosed ESPN's revenue and operating income, with the latter representing a significant portion of DMED's revenue and operating income. Martin projected FY23 and FY24 revenues and EPS slightly above consensus.
October 19, 2023 | 4:22 pm
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Charter Communications' recent carriage dispute with Disney could indicate a desire for a larger revenue share, potentially impacting its future earnings.
The recent carriage dispute between Charter Communications and Disney could indicate that Charter is seeking a larger share of revenue. This could potentially impact its future earnings and stock price.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
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Disney's high consensus estimates, DTC losses, and weak earnings from linear TV and box office could put pressure on its stock. However, its asset mix and AI benefits could make it attractive to potential buyers.
The analyst's concerns over Disney's high consensus estimates, DTC losses, and weak earnings could negatively impact investor sentiment and put pressure on the stock. However, the company's asset mix and benefits from generative AI could make it attractive to potential buyers, potentially providing some support to the stock.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100