Disney Set to Reveal Key Earnings: Will the Momentum Continue?
Wall Street is keeping a close eye on Disney DIS as the entertainment giant prepares to unveil its fiscal fourth-quarter results on Thursday, November 14. With shares gaining +13% this year, investors are curious about what lies ahead.
Anticipations for Disney’s Q4 Report
For Q4, Disney’s projected sales are $22.59 billion, which marks a 6% increase from $21.24 billion in the same quarter last year. Notably, the company’s earnings per share (EPS) are expected to rise by 33% to $1.09, compared to $0.82 the previous year.
Disney has consistently surpassed earnings expectations for seven quarters and boasts an impressive average EPS surprise of 18.01% over the last four reports. In terms of revenue, the company has exceeded projections in two of the past four quarters, achieving an average sales surprise of 1.05%.
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Evaluating Disney’s Streaming Growth
Disney’s focus on cost-cutting measures, coupled with workforce reductions, has played a significant role in its financial performance. EPSN+ subscribers are forecasted to reach 25.73 million, while Disney+ subscribers are expected to be around 120 million. However, this represents a decline from the 150 million subscribers reported last year. On a positive note, with Hulu subscribers projected at 51 million, Disney will be nearing a total of 200 million streaming memberships.
This puts Disney just behind streaming leader Netflix NFLX, which reported over 280 million paid memberships in October.
Assessing Disney’s Valuation
With shares trading around $102, Disney’s stock has a forward earnings ratio of 19.2X, representing a discount to the S&P 500’s 25.3X and Netflix’s 41.4X. Additionally, DIS trades at less than 2X sales, which is favorable compared to the S&P 500’s 5.4X and Netflix’s 9X.
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Conclusion
Disney’s upcoming Q4 report is vital for assessing its trajectory of growth, as the company currently holds a Zacks Rank #3 (Hold). Nevertheless, long-term investors may find potential rewards, given Disney’s attractive valuation. The average Zacks Price Target stands at $114.92 a share, indicating a potential upside of 14% for DIS.
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The Walt Disney Company (DIS): Free Stock Analysis Report
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The views and opinions expressed herein represent those of the author and do not necessarily reflect those of Nasdaq, Inc.
