That's right -- they think these 10 stocks are even better buys. If you have an ad-blocker enabled you may be blocked from proceeding. Opinions expressed by Forbes Contributors are their own. Currently, DIS is trading at an EV-to-EBITDA multiple of 18.46, which is the highest among its peers. So is Disney a buy? 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. Stock Market Falls Ahead Of Inflation Report; Just A Bullish Pause? Analysts now expect EPS to jump 66% for the fiscal year ending in September 2022, followed by a 39% jump in fiscal '23, according to S&P Global Market Intelligence. Consequently, it's best not to invest in Disney solely for the potential of a dividend, as there's no confirmed date of its return, and it will be marginal when it is back. Since then, Marvel has been an incredible asset for Disney. Then, economic declines in 2022 strained the streaming industry as people reduced discretionary spending. 3 Dates for Disney Stock Investors to Circle in March, Disney Can't Make a Multiplex Mountain Out of an Ant Hill, This Could Be a Reason Disney Stock Soars This Year, 2 FAANG Stocks Billionaires Are Selling in Droves and 1 They Can't Stop Buying, 2 Growth Stocks That Can Turn $250,000 Into $1 Million by 2030, This State Has the Highest Real Estate Taxes (and It's Not Even Close), Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Motley Fool Issues Rare All In Buy Alert, Copyright, Trademark and Patent Information. Since reaching an all-time high closing price in March 2021, Disney stock has been spiralling down to below its pre-pandemic level. 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. The investment case for Disney hinges on the growth of Disney+, so it's understandable for the stock to trade in line with the rate of subscriber growth, but the market overreacted to Disney's results last quarter. 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. In the surprise boardroom shuffle, Iger will serve as Disneys CEO for two years. (Photo Illustration by Igor Golovniov/SOPA Images/LightRocket via Getty Images). Discovery, which experienced stock declines of 51% and 62%, respectively, in 2022. A second location in Orlando, Fla., was announced in 1965. Stronger revenue from Disneys Parks & Experiences segment helped to cushion losses from the DTC. The latest Disney stock news that moved the Disney stock price today came from its diluted first-quarter earnings report for 2022. Throughout its near century-long history, Disney has grown into a multi-billion-dollar business, famous for its flagship family-oriented brands. In addition, Disney announced solid earnings, with an increase in revenue and beating EPS estimates for the fiscal Q1:2023. This isnt going down well with investors, who are increasingly focusing on cash flows as interest rates rise. A closer look at its segments reveals that revenue from Disney Media and Entertainment Distribution fell 3% year-over-year (YoY) to $12.72bn in the fourth quarter of2022 owing to widening losses for Direct-to-Consumer (DTC) and Content Sales/Licensing. Disney is much more than Marvel. And as you can see below, BABA beat on both top . Iger is getting his ducks in order in his third transformation. Meantime, theme park revenue picked up. Get the latest Netflix news, plus stock quotes and analysis. balance sheet and inputs from the stock market. *Average returns of all recommendations since inception. Another activist investor, Dan Loeb, advised Disney, took a stake in the company, and pushed for change during the second half of 2022. BREAKING: Salesforce Soars Late, Tesla Doesn't Unveil New EV. It's a new calendar year for Walt Disney (NYSE: DIS) investors, and so far, 2023 looks pretty good. Disney Entertainment: entertainment media and content businesses globally, including streaming. Last year's stock market sell-off led shares of The Walt Disney Company ( DIS 0.15%) to plunge 44% . Read on to find out. can generate Disneys stock price forecast beyond 2022. However from that point Disney, like many Dow 30 members, was part of a huge run up over the next 3 years. The Disney stock price targets ranged from a low of $94 to the high of $185. The stock trades at about 27x consensus 2022 earnings and a little over 20x ZRX 2023 earnings. Stock prices have fallen precipitously across sectors over recent months and we are now in a bear market for the first time since March 2020, when the Covid-19 outbreak triggered a market crash. Can Disney fight its way out of the slump? 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. In addition, rising US inflation started to bite into household spending around the time when streaming services, including Netflix, raised their subscription fees. Disney has been on a downward trajectory since the beginning of 2022, despite starting strong at $157.83 on 3 January. Read The Big Picture for detailed daily analysis of what's going on in the stock market. Get market updates, educational videos, webinars, and stock analysis. So far, the movie theater industry hasn't met an untimely demise, as many predicted. While the decline was substantial, the entertainment company actually fared better than its biggest competitors, Netflix and Warner Bros. Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. The 90s brought two more stock splits, one 4 for 1 in 1992 and then a 3 for 1 stock split in the summer of 1998. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Follow Matt Krantz on Twitter at @mattkrantz, View Breakout Stocks & Technical Analysis, Get Free IBD Newsletters: Market Prep | Tech Report | How To Invest, Catch The Next Big Winning Stock With MarketSmith. Invest with Trefis Market Beating Portfolios. Last year Disney films won 23 Oscar nominations. 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. ). I am not receiving compensation for it (other than from Seeking Alpha). Always conduct your own due diligence by reviewing the most recent analyst commentary, Disney stock news, technical and fundamentals analysis. It's fine-tuning this formula for the streaming era, and the 10 films coming to theaters this year may make 2023 a blockbuster year for Disney. 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. These symbols will be available throughout the site during your session. As Netflix (NFLX -2.69%) has demonstrated over the last 10 years, content releases lead to subscriber growth. It's a bonus that some of these shows, such as La Casa de Papel (aka Money Heist) and Squid Game, have translated to high viewership in the U.S. and Canada too. Making the world smarter, happier, and richer. The earnings number also surpassed the . However, Disney's recent success with Avatar: The Way of Water could mean audiences are truly back. You should conduct your own due diligence, and never invest or trade money you cannot afford to lose. account day-to-day movements in market value compared to a companys liability structure. Discovery. That's nearly 21% potential upside. Chart by author. 2023 Capital Com Online Investments Ltd. Additionally, Florida Gov. Jennifer Saibil for The material provided on this website is for information purposes only and should not be understood as an investment advice. DPEPs operations has two main business lines: Parks & Experiences and Consumer Products. There are several factors weighing the stock down. Disney has become a force in the streaming business with 179 million subscribers. The Motley Fool has a disclosure policy. . DTCs operating results were expected to improve by at least $200m in the first quarter of fiscal2023 versus the fourth quarter of2022, partly supported by increases in subscription prices, she added. However, it was still way above the inflation target of 2%. These are planned for release over the next few years. Disneys stock price gained 31.9% during 2019, compared to around a 2% increase in 2018. The question above was, whether the transformation work can be completed before conditions change again. (read more). You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. its popular franchises like Marvel and Star Wars in the fourth quarter of 2022 on Disney Plus, according . In the earnings call on 8 November, CEO Bob Chapek said the company still expected to achieve profitability in fiscal 2024, with losses expected to decrease in the first quarter offiscal 2023 and no significant shifts in the economic environment. "We are intent on reducing our debt," Iger said on 2/9/2023 during an interview on CNBC. 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. IBD Stock Checkup assigns Disney a 52 Composite Rating, which combines key fundamental and technical metrics in a single score. 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. On 12/29/2022, I gave a sell rating to Disney DIS at $87.18 based on this investment theme. 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. 3 Dates for Disney Stock Investors to Circle in March, Stocks most and least liked by hedge funds and mutual funds - Goldman, T. Rowe Price Associates, Inc. (Investment Management), Northern Trust Investments, Inc.(Investment Management), Chairman-International Content & Operations, Chief Compliance Officer & Senior Vice President, Chief Diversity Officer & Senior Vice President, Chief Financial Officer & Senior Executive VP, Chief Human Resources Officer & Senior EVP, Chief Security Officer & Senior Vice President, EVP-Controllership, Financial Planning & Tax, Executive VP-Corporate Social Responsibility, Regional Director Bus Dev Operating Participants, Senior Executive Vice President & General Counsel, Registration on or use of this site constitutes acceptance of our. See our analysis of Disney valuation for more information on whats driving our price estimate for Disney and how its valuation compares with peers. The history of the company started when brothers Walt and Roy founded the Disney Brothers Cartoon Studio on 16 October 1923, following Walts success in selling his first pilot cartoon film series,Alice Comedies. Learn all the ways IBDs top investing tools can help you succeed in the market! The list includes 21st Century Fox, Marvel Studios, Lucasfilm, Pixar and Blue Sky Studios. It operates through the following segments: Disney Media and Entertainment Distribution (DMED) and Disney Parks, Experiences and Products (DPEP). DIS. 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. The score provides a forward-looking, one-year measure of credit In the fourth quarter of 2022, Parks & Experiences booked revenue of $7.42bn, jumping 36% from the year-ago period of $5.45bn. This overvaluation may be due to investors' confidence that growth will increase following Iger's restructuring efforts. That's nearly 21% potential upside. We expect that Iger will unwind some of the major changes put in place by Chapek. Disney's dividend yield in 2019 was 1.2%, and CFO Christine McCarty has said the next one "will likely be a small fraction of our pre-COVID dividend with the intention to increase it over time as our earnings power grows." Here it stacks up against any other studio that had a top-10 film in 2022, which includes Paramount, Universal, and Warner Bros. Capital Com Online Investments Ltd is a limited liability company with company number 209236B. 86% of retail CFD accounts lose money, Analysts Have Strong Buys on These 2 Beaten-Down Stocks. Guidance still points to the service reaching profitability by fiscal 2024. Our priority is the enduring growth and profitability of our streaming business. 2022 highest-grossing films by parent company. Dani Cook has no position in any of the stocks mentioned. UPDATE: Disney stock values have continued to drop. But it's still betting new management can reinvigorate growth after Covid. 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