Since May last year, shares of Walt Disney Co have jumped by about 4.76% and is believed by most to be climbing on an upward trend up to this year.
An earnings report is set to be released this February 14 with most analysts forecasting earnings per share of $1.50 down by 7.98% compared to the recent year’s $1.63 earnings per share down by $0.13.
Despite a rough start for Disney Co's shares last 2016, a series of blockbuster films from the company led them to go beyond and exceed their $1
Although the blockbuster sales are soaring way above expected, shares of the company came out unaffected only rising marginally by about 0.8% marking the company’s worst performance in the past five years.
Some analysts still hold their grounds on Disney shares remaining as a long term investment should the company’s own efforts in the ESPN network would not drag Walt Disney Co down any further.
Over the past year, Disney stocks have moved up from around $86 to $108 but have not shown any indication to go higher than $109 or even touch it. Many investors and shareholders are pointing the decline in the success of the company being hampered by their focus on ESPN whose profits have been declining for the second year in a row led about by the decreasing number of subscribers.
Stocks Low Despite Box-Office Hits
Despite Disney coming up with a series of successful and back to back blockbuster films this year starting with Finding Dory, Captain America, and the recently released Rogue One movie, the uncertainty and shareholder doubt on Disney’s ESPN acquisition business remains a top concern.
Although there is still rising concern on ESPN, some analysts and investment firms have upgraded the stock rating of Walt Disney Co stating that an investment with the company will greatly be beneficial for the year as the company’s earnings from their blockbuster sales will greatly affect the shares positively this year.
The film sector of the company is also set to deliver another 20% rally this year as more anticipated films are to be released. A target price of $125 has been given by the Bank of America Merrill Lynch to Walt Disney Co. The Disney stock, meanwhile, has ranged from around $86 to $108 through the course of 2016 although it has failed to show a sign of reaching higher than $109.
A huge number of investors are now pointing their fingers to Disney’s ownership of almost 80% of ESPN whose outlook is not looking bright as it continually loses subscribers for the second year in a row.
By Tuesday, Disney shares have reached a 52-week high at $106.90 following a buy rating from Evercore and a target price of $120. Shares also rallied up by 1.78% the same day at $106.08.
Although the overall performance of the company has ended 2016 with a bitter note, Disney’s performance from October 2016 until December 2016 recording a 12% rally signaling a stronger outlook for the beginning of 2017.
At the moment, analysts are expecting the stock to rally by around 13% in the duration of the year and with bigger revenues with the release of more films highly anticipated by the public this 2017, the company is expecting another better-than-forecasted blockbuster film sales which would drive up to Disney’s revenue.