Disney: Earn on your daily entertainment
START - $94.56 | FINISH - $111.78
a. HORIZON: 4 months
b. FROM 19-09-2024 | UNTIL 19-01-2025
c. MANAGEMENT ASSESSMENT: 20% growth
d. RECOMMENDATION: BUY
TRADING PLAN
Buy Walt Disney Company (DIS) shares from the $94.56 level with a target of $111.78 for 4 months.
WHY THESE SHARES HAVE POTENTIAL FOR PROFIT
- Streaming and Parks: Disney's streaming services including Disney+, Hulu, and ESPN+ remain the centre of its future growth. The company has been restructuring its media business to address profitability concerns.
- Earnings Growth: Disney's earnings are projected to grow over 16% annually in the next few years. It has also made notable gains in park revenue, increasing its free cash flow as the tourism sector recovers.
- Stock Price Targets: Analysts have an optimistic outlook on the Disney share price, with targets ranging from $94 to $140.
INDICATORS
A. Forward P/E ratio – 18.82x
B. Dividend yield – 0.81%
C. The company’s balance sheet metrics:
i. DIS has total assets of $197.72B
ii. Total equity of $105.30B
iii. Total liabilities of $92.47B
GROWTH FORECAST
1 Year Revenue: 7.11%
RISKS
- Streaming Profitability: While Disney+ has grown substantially, the company still faces challenges in making its streaming division sustainably profitable. The market is saturated and content costs are high, forcing Disney to be innovative to maintain subscriber growth.
- Economic Sensitivity: Disney’s park and cruise divisions are vulnerable to economic downturns and their performance is closely tied to consumer spending. As the economy remains uncertain, any economic slowdown could affect these divisions.
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