What to Watch For When Disney Reports After the Close

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Walt Disney Co. (NYSE: DIS) is scheduled to release its fiscal first-quarter financial results after the markets close on Tuesday. Thomson Reuters consensus estimates call for $1.55 in earnings per share (EPS) and $15.18 billion in revenue. The same period of last year reportedly had $1.89 in EPS and $15.35 billion in revenue.

This company has been around since 1923, and management is making the biggest bet in its history as media consumption shifts from theaters and the TV screens to streaming to homes and phones. At the same time, Disney maintains the most stable part of its portfolio in its theme parks, which contributed $20 billion of Disney’s $59 billion in revenue last year.

While Disney transformed itself with acquisitions of Pixar, Marvel and Star Wars, now it has transformed itself even further via the acquisition of the 21st Century Fox assets. Disney said at its merger approval meeting in 2018 that it expected to pay a total of about $35.7 billion in cash and issue approximately 343 million new Disney shares to 21st Century Fox stockholders. The then-current 21st Century Fox stockholders were projected to own a stake of between 17% and 20% in the “New Disney.”

The Mouse House also has a large stake in Hulu, and maybe all these changes finally will change the focus of the analyst community worrying endlessly about the ESPN trends.

Overall, Disney has underperformed the broad markets, with its stock up only 2% year to date. In the past 52 weeks, the stock is up only 1%.

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

  • Credit Suisse has a Hold rating and a $114 price target.
  • Wolfe Research has an Outperform rating.
  • Imperial Capital has an Outperform rating with a $129 target.
  • Argus has a Buy rating with a $135 price target.
  • B. Riley has a Neutral rating.

Shares of Disney were last seen trading at $111.80, in a 52-week range of $97.68 to $120.20. The consensus analyst price target is $124.70.

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