The Walt Disney Company (NYSE: DIS) released its fourth quarter earnings on Thursday, November 6th. The mass media corporation is based in Burbank, California, and is best known for its film studio, broadcasting networks, and theme parks. The Q4 report narrowly beat analyst estimates with much of the success attributed to the hit films Frozen, Guardians of the Galaxy, Maleficent, and Captain America 2.
Highlights of the Q4 report include $0.89 adjusted earnings per share on a diluted basis, beating the analyst consensus by $0.01. During the same quarter of last year, Disney posted $0.77 earnings per share marking a 15% year-over-year increase. The mass-media giant reported earnings per share for the year of $4.26 on a diluted basis; a 26% year-over-year increase from $3.38. Disney earned revenue of $12.39 billion for the quarter and 48.81 billion for the fiscal year. Annual revenue beat the analyst consensus of $48.74 billion and marked an 8% year-over-year increase.
Despite its satisfactory results, Disney’s earnings fell slightly after the release of its report. Some speculate that investors expected Disney to beat estimates by a larger margin, while others point to the higher production and programming costs on ESPN and ABC networks. However, income derived from Walt Disney Studios more than doubled thanks to Frozen, a movie hit that won the hearts of children and young adults. Frozen’s success also attributed to a growth in merchandise sales. Moreover, Disney saw growth in their parks and resorts driven by an increase in ticket prices and higher rates of attendance and spending.
CEO Robert Iger was very pleased with the report, celebrating the highest fiscal results in the Company’s history and the “fourth consecutive year of record performance.” Iger attributed the success to “the extraordinary quality of our content and our unique ability to leverage success across the Company to create significant value, as well as our focus on embracing and adapting to emerging consumer trends and technology.”
Investors and Disney fans alike have a lot to look forward to as Disney announced that they will be releasing 21 new movies in the next 3 years. Highlights include Toy Story 4, Star Wars: The Force Awakens, Cars 3, The Incredibles 2, and Finding Dory.
Shares of Disney opened at $89.39 on Friday, November 7th. The company has a 1-year high of $92.00 and a 1-year low of $67.30. The daily moving average is $89.34 and it has a 50-day moving average of $87.99. The market cap for Disney is $154.49 billion and its P/E ratio is 21.61.
On November 7th, Matthew Harrigan of Wunderlich reiterated a Hold rating with a price target of $88.00. Harrigan explained “Although shares of Hold-rated Walt Disney (DIS) were under some pressure after the market close following the FQ4 earnings release, we would use any weakness to accumulate shares for investors comfortable with the global macro position.” He continued, “We remain rabid fans of the studio, with a likely Street high $22B valuation, but are cautious on the cyclical aspects of the Parks and Cable Networks (ESPN) businesses.” Harrigan has a 71% overall success rate recommending stocks with an average return of +7.3% per recommendation.
Separately on November 7th, Jessica Reif Cohen of Bank of America reiterated a Buy rating with a price target of $105.00. Reif Cohen noted several highlights from the report, including “high single digit affiliation growth at Cable Networks, Syndication gains at ABC studio,” and revenue growth from theme parks. Reif Cohen has a 74% overall success rate recommending stocks with an average return of +6.2% per recommendation.
On average, the top analyst consensus for DIS is Moderate Buy.
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Sarah Roden writes about stock market news. Sarah can be reached at Sarah@tipranks.com
