What to Expect When Disney Reports

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Walt Disney Co. (NYSE: DIS) is scheduled to release its most recent quarterly results after the markets close on Tuesday. The consensus estimates for the fiscal third quarter call for $1.95 in earnings per share (EPS) and $15.34 billion in revenue. The same quarter of last year reportedly had $1.58 in EPS and $14.24 billion in revenue.

During the most recent quarter, it was announced that Disney would be acquiring Twenty-First Century Fox. It took a couple tries but the Mouse House found the right price to outbid Comcast for Fox.

Under the terms of the agreement, Disney will be acquiring Fox for $38 per share in a cash and stock deal. The overall mix of consideration paid to Fox shareholders will be approximately 50% cash and 50% stock. The total price tag for the transaction is $71.3 billion.

However, Disney will not be getting all of Fox, as Fox is spinning off some businesses prior to the acquisition. The 21st Century Fox businesses to be acquired by Disney remain the same as under the original agreement.

The acquisition will occur immediately after the spin-off by Fox of the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FS1, FS2 and Big Ten Network into a newly listed company referred to as New Fox.

Excluding Tuesday’s move, Disney had underperformed the broad markets with its stock up over 7% in the past 52 weeks. In just 2018 alone, the stock is up closer to 8%.

A few analysts weighed in on Disney ahead of the report:

  • Merrill Lynch has a Buy rating with a $144 price target.
  • Credit Suisse has a Neutral rating and a $114 price target.
  • Pivotal Research has a Sell rating with a $93 target price.
  • B. Riley has a Neutral rating with a $123 target price.

Shares of Disney were last seen up about 1% at $117.16 on Tuesday, with a consensus analyst price target of $117.57 and a 52-week range of $96.20 to $117.88.