Shares of mass media and entertainment conglomerate The Walt Disney Company (DIS) jumped 5.7% to close at $189.50 in extended trade on Thursday after the company reported better-than-expected results for the fiscal third quarter ended July 3, 2021.
Quarterly revenues stood at $17 billion, up 45% from the previous year’s figure of $11.8 billion, surpassing the consensus estimate of $16.81 billion. The growth in revenues was primarily driven by the growth witnessed in the revenues of two key segments — Disney Media and Entertainment Distribution, and Disney Parks, Experiences and Products.
While revenues from Disney Media and Entertainment Distribution grew 18% year-over-year to $12.7 billion, Disney Parks, Experiences and Products revenue jumped from $1.07 billion to $4.34 billion in the third quarter.
The company reported quarterly earnings per share (EPS) of $0.80, up over 100% from $0.08 last year. Moreover, it topped the consensus estimate of $0.57.
The CEO of Walt Disney, Bob Chapek, said, “We continue to introduce exciting new experiences at our parks and resorts worldwide, along with new guest-centric services, and our direct-to-consumer business is performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of the quarter, and a host of new content coming to the platforms.” (See Walt Disney stock chart on TipRanks)
Prior to the earnings, MoffettNathanson analyst Michael Nathanson reiterated a Hold rating on the stock. The analyst, however, raised the price target from $175 to $185, which implies upside potential of 3.2% from current levels.
According to Nathanson, the company’s stock is at an interesting place. On the one hand, the analyst expects direct-to-consumer (DTC) subscribers to significantly slow down, while, on the other hand, he sees the reopening of the economy and subsequent rise in domestic air travel to Disney’s parks acting as tailwinds for the company.
Consensus among analysts is a Strong Buy based on 16 Buys and 3 Holds. The average Walt Disney price target of $210.71 implies upside potential of 17.5% from current levels.
Walt Disney scores an 8 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained 36.9% over the past year.
Related News:
Cineplex Revenue Almost Triples in Q2
eBay Reports Mixed Q2 Results; Street Says Buy
Wendy’s Q2 Results Top Estimates, Raises Guidance
