Media

Disney Posts Great Earnings, but Not a Great Stock Reaction

The Walt Disney Co. (NYSE: DIS) has another blowout for earnings this quarter, posting strong numbers throughout all of its business segments. Unfortunately, the investment community has seen so many great earnings reports from Bob Iger and team that the shares did not rally after earnings.

For Disney’s fiscal third-quarter earnings, it reported $1.28 per share and $12.46 billion in revenue, surpassing estimates for yet another consecutive quarter. Those consensus estimates from Thomson Reuters were $1.16 in earnings per share and $12.16 billion in revenues. Earnings per share posts a 10% increase from the previous quarter and a 26.7% increase from the previous year at $1.01. Revenue increased a total of 8% from the previous year.

Each of Disney’s business segments has contributed directly to revenue again. These were the unit by unit readings:

  • Media Networks rose by 3% and operating income was relatively flat at $2.3 billion.
  • Parks and Resorts rose 8% and operating income increased 23% to $848 million.
  • Studio Entertainment rose 14%, with an increase in operating income over 100% to $411 million.
  • Consumer Products rose by 16% and operating income rose by 25% to $273 million.
  • Interactive rose by 45%, and rose from a loss of $58 million to an income of $29 million.

Disney shares closed down about 0.5% at $86.75 on the day, but the stock’s 52-week range of $60.41 to $87.63 should explain how much it has risen in the past year. Disney traded at almost 19 times expected 2015 earnings ahead of this report.

The long and short of the matter is that Disney is hard to pick at for bad news here. The stock has just risen and risen, and it was priced for perfection (and then some!).

ALSO READ: Why Disney Shares May Be Headed Up to $100, With or Without Star Wars

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