Barclays upgrades Walt Disney, sees positive estimate revisions ahead
Barclays upgrades Walt Disney (DIS), sees positive estimate revisions ahead
DIS
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Barclays upgraded Walt Disney (NYSE:DIS) to Overweight from Equal Weight in a note Monday, raising the price target to $135 from $95 per share.
The bank told investors that the recent narrative is likely to be followed by positive estimate revisions, which is still early in the cycle and should
further support valuation.
“The incessant Disney-related news flow ahead of the proxy vote has dominated investor considerations since last quarter’s earnings, and we expect this to continue helping the stock near term,” said Barclays.
Analysts explain that this process and the consequent spate of announcements since the company’s last earnings call has helped investors gain more confidence about earnings estimates having bottomed.
The bank noted that this phase of earnings stabilization has been largely driven by tactical tailwinds from the strike last year, but they do believe the next phase may be more impactful as several turnaround elements still remain in progress and may manifest more in numbers starting next year.
Analysts added, “There may also still be some sources of upside narrative surprises, such as ESPN’s streaming partnerships.”
Overall, while Barclays is now bullish on the stock, they acknowledged that Disney still has a number of challenges to work through and that visibility on many elements is still low.
