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Disney’s strong quarterly results and full-year guidance raise has analysts giddy at the media giant’s prospects. The company posted fiscal second-quarter earnings and revenue that exceeded consensus estimates, driven in part by an unexpected uptick in streaming subscribers and upped its full-year guidance. The report sent Disney shares up more than 10%, boosting the Dow Jones Industrial Average. Wednesday’s gain put share on pace for their best day since April 9. Heading into Disney’s earnings release, analysts were closely awaiting the company’s theme parks and streaming results — segments viewed as highly vulnerable to macro weakness. The company managed to post revenue growth across all its segments during the fiscal third quarter. Here are what some of the top analysts on Wall Street said after Disney reported earnings: Barclays reiterates overweight rating and $115 target According to analyst Kannan Venkateshwar, Disney has the least structural risks relative to other media companies — in addition to the largest potential gains from its streaming business. This price target implies 24.8% upside from Tuesday’s close. “The company’s performance in the first half and guidance for the rest of the year should help investors gain more conviction around growth trajectory. … Overall, we continue to believe Disney remains one of the most attractive investments in our coverage universe despite obvious macro exposure.” Bank of America maintains buy rating, $140 price target Analyst Jessica Reif Ehrlich noted that Disney’s earnings growth outlook increase is encouraging with recent macro concerns in mind. Her target price of $140 per share implies nearly 52% upside. “Near term catalysts include: 1) profitability inflection in DTC, 2) reacceleration in the Parks business and 3) strong film slate which drives other businesses (DTC, Parks and Consumer Products).” UBS reiterates buy rating, $105 price target Analyst John Hodulik highlighted Disney’s “resilient results,” as well as its 29% year-over-year growth in advertising across its sports segment. “Total revenues grew 7% y/y (UBSe 4%/Street 5%), while segment OI grew 15% to $4.44B (UBSe $4.06B, Street $3.98B).” Goldman Sachs keeps buy rating, $140 target Analyst Michael Ng pointed to outperformance in the company’s experiences division, which was driven by better-than-expected domestic theme park attendance. Ng is bullish on the profitability prospects for Disney, as well as improved studio costs and theme park growth. His price target implies upside of more than 51% from Tuesday’s close. “We are Buy-rated on DIS as we believe the company is a high quality EPS compounder supported by 1) continued progression to scaled long term DTC profitability made possible by wholesale arrangements, bundled offerings, password sharing restrictions and other initiatives; 2) studio performance improvement (from a period of under earning) enabled by cost rationalization and organizational restructuring.”
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