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On Thursday, Bernstein analysts, led by Laurent Yoon, maintained an Outperform rating on Walt Disney stock (NYSE:DIS) with a steadfast price target of $120.00. The entertainment giant, currently valued at $187.5 billion, has seen its stock surge over 12% in the past week. The analysts highlighted Disney’s raised FY25 earnings per share (EPS) guidance to $5.75, indicating a year-over-year growth of over 15%, following a 20% year-over-year growth in the second fiscal quarter of the year. According to InvestingPro data, the stock appears slightly undervalued based on its Fair Value analysis. The firm projects continued robust performance into FY26, propelled by direct-to-consumer (DTC) margin expansion, cruise line growth, and recovery in Parks, suggesting that EPS could realistically reach the mid-$6 range.
The Experiences segment, according to Bernstein, is demonstrating resilience in the U.S. market despite broader economic concerns. With summer bookings on the rise and competition from EPIC Universe on the horizon, Disney management maintains a positive outlook. This confidence is supported by the company’s solid financial health score of "GOOD" from InvestingPro, which notes that Disney operates with a moderate level of debt and has been profitable over the last twelve months with revenue reaching $92.5 billion. The 6% year-over-year growth for the quarter, along with encouraging forward bookings data, suggests that there may be further room for upward revisions in Disney’s guidance.
While Bernstein has not yet incorporated potential gains from ESPN Flagship into their evaluation due to awaiting go-to-market strategy details, they anticipate that the expansion will enhance Disney’s sports franchise. For deeper insights into Disney’s ESPN strategy and comprehensive financial analysis, including 8 additional ProTips and detailed valuation metrics, check out the Pro Research Report available on InvestingPro. This growth is expected to come from reaching beyond traditional linear models, growing bundled subscriptions, reducing churn rates, and achieving greater marketing efficiencies. The firm acknowledges there are various factors to consider and plans to update their analysis once additional information becomes available.
In other recent news, the Walt Disney Company reported a strong second quarter for 2025, surpassing analyst expectations with an adjusted earnings per share (EPS) of $1.45, compared to the forecasted $1.21. The company’s revenue also exceeded predictions, reaching $23.62 billion against an anticipated $23.13 billion. Following this performance, Disney has raised its full-year EPS guidance from $5.30 to $5.75. Jefferies analyst James Heaney responded to Disney’s financial results by increasing the stock price target to $100 from $87, while maintaining a Hold rating. Heaney noted the positive momentum in Disney’s streaming service, Disney+, and its Experiences division, which alleviates concerns about competition and economic challenges. Disney’s strategic expansion continues with the announcement of a new theme park in Abu Dhabi, marking its commitment to global growth. The company’s strong performance in its experiences segment and ESPN viewership has been highlighted as significant contributors to its financial success. These developments reflect Disney’s strategic initiatives and robust operational execution, which have positioned it favorably against competitors.
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