On Thursday, Needham increased its price target on shares of Walt Disney (NYSE:DIS) to $145.00, up from the previous target of $120.00, while reiterating a Buy rating on the stock. The adjustment reflects updated projections for various segments of Disney's business, including Linear Networks, Content Sales/Licensing, Sports, and Experiences.
The firm has revised its fiscal second quarter 2024 estimates, now expecting revenue to reach $22.3 billion, which represents a 2% year-over-year increase but is 3% lower than their earlier estimate. Operating income (OI) is anticipated to be $3.7 billion, marking an 11% increase from the previous year and 7% higher than the prior forecast. Additionally, the adjusted earnings per share (EPS) are projected at $1.10, indicating an 18% year-over-year rise and 5% above the previous estimate.
Needham's new estimates suggest a positive outlook for Disney's financial performance, with the firm raising its operating income projections for fiscal years 2024 and 2025. The revised price target and maintained Buy rating indicate confidence in Disney's ability to grow its key business segments and deliver increased profitability.
The updated figures are based on the analyst's expectations for Disney's various divisions, including Linear Networks, which encompasses Disney's traditional broadcasting operations, and Content Sales/Licensing, which deals with the distribution of Disney's extensive media library. The Sports segment likely includes revenue from broadcasting sports events, while Experiences may refer to Disney's theme parks and related businesses.
Investors and market watchers will likely keep an eye on Disney's upcoming financial reports to see if the company's performance aligns with Needham's projections. The new price target of $145.00 represents a significant potential upside from the previous target, suggesting that Needham sees continued growth potential for Disney shares.
InvestingPro Insights
As Walt Disney (NYSE:DIS) positions itself for potential growth, real-time data and analysis from InvestingPro offer additional context for investors. With a current market capitalization of $225 billion and a high P/E ratio of 75.21, Disney is trading at a premium, reflective of investor confidence in the company's future profitability. These metrics underscore Needham's optimistic outlook and the recent price target increase. Moreover, Disney's revenue growth over the last twelve months stands at 5.35%, aligning with the positive expectations set forth by analysts.
InvestingPro Tips highlight that Disney's net income is anticipated to grow this year, and seven analysts have recently revised their earnings projections upward for the upcoming period. These insights suggest a consensus view that Disney's financial health is on an upward trajectory. Additionally, the company's shares are trading near their 52-week high, which, in combination with a strong return of 33.83% over the last three months, may attract investors looking for companies with robust performance and momentum.
For investors seeking more in-depth analysis, there are additional InvestingPro Tips available, providing a comprehensive look at Disney's financials and market position. Use the coupon code PRONEWS24 to receive an extra 10% off a yearly or biyearly Pro and Pro+ subscription, and unlock the full potential of InvestingPro's insights.
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