You probably need no introduction when it comes to the widely renowned entertainment industry, The Walt Disney Co.,(DIS:NYE) is set to reveal its upcoming Q3 earnings results today on August 9th. This has raised a blend of concern and optimism in the air.
In this comprehensive analysis, we shed light on the potential challenges that could hinder Disney’s market performance. It provides insights into the factors shaping the company’s outlook, as well as the strategies it employs to pave the path forward.
DIS Stock Earning Comparison: Year 2023 and 2022
Looking at 2022, the earnings per share (EPS) was $1.09. Whereas now, Wall Street expects Disneys’s Q3 adjusted earnings to be $0.98 per share, which is lower than last year. The joined consensus of analysts revealed the revenue to be 4.6% higher than the last year, making it $22.49 Billion.
Factors Leading to Disney’s Downfall:
Walt Disney has seen apparent shortcomings over the past few years which contribute as an affecting factor to its leading downfall. Things are expected to go downhill regarding DIS stock performance. The fall in Q3 earnings of DIS stock has found its root cause in these below-stated factors:
- The Tv advertising revenues have weakened
- Lesser people visiting the Disney theme parks
- Current strike of actors and writers in Hollywood
- Direct-to-Consumer segment losing subscribers
- Disney’s ESPN not getting enough viewership post-pandemic
Navigating Headwinds with Strategic Resilience:
Investors and analysts expect the CEO Bob Iger to change the fate of Disney by implementing strategic measures. He is looking to join hands with a strategic partner. The CEO has already cut down the costs and is taking further steps to improve DIS stock earnings. Iger intends to sell an equity stake in ESPN, as well as Disney’s broadcasting networks like ABC Broadcast and National Geographic to uplift the DIS stock earnings.
DIS Stock Forecast Analysis:
(DIS:NYE) has a current price of USD 88.13 and a market CAP of 157.70 Billion. The average analyst target is USD 120.71 with a whooping upside potential of 36.97%. Disney’s year-to-date capital gain value is only as high as 1.44% in the entertainment industry.
DIS Stock Forecast: Should You Buy it?
DIS stock is overpriced than the rest of its peers but has high market capitalization and positive cash flow. Moreover, it has delivered a superior return on equity for the recently passed four-quarters. The analyst Deutsche Bank lowered the target by USD 131 to USD 120. The analysts neither view (DIS:NYE) as Bullish nor Bearish. They rate it as a “Strong Buy” with a Neutral view.
The Takeaway:
Walt Disney’s Q3 earnings preview is marked by a mixture of optimism and caution, reflecting the complex landscape in which the entertainment company operates. While concerns about different challenges persist, Walt Disney’s commitment may bring about a positive change.
