Situated in Burbank, California, The Walt Disney Company (DIS) is among the world’s largest entertainment companies, producing and distributing film, TV, and streaming content. With a market cap of $211.9 billion, it operates through its Entertainment, Sports, and Experiences segments.
Companies valued at $200 billion or more are generally considered "mega-cap" stocks, and Walt Disney is a prime example of this, reflecting its considerable size, stability, and impact in the global entertainment industry. As a prominent media and entertainment giant, Disney exemplifies the power and stability of a large-cap company, driven by its vast portfolio of iconic content, dominant market presence, and unwavering focus on innovation and growth across film studios, television networks, theme parks, and streaming platforms.
DIS shares are trading 5.9% below their 52-week high of $123.74, which they hit on Mar. 28. DIS has climbed 31.4% over the past three months, outperforming the S&P 500 Index’s ($SPX) 10.4% gains during the same time frame.
In the long term, DIS is up 29% on a YTD basis and gained 28.3% over the past 52 weeks. In comparison, the $SPX has gained 27.4% in 2024 and rallied 33% over the past year.
DIS has been trading above its 50-day and 200-day moving average since mid-November, which indicates a bullish price trend.
Despite robust price performance, rising operational costs, upcoming expenses for Disney Cruise Line, and a modest forecast for Disney+ subscriber growth further fueled investor worries, overshadowing improvements in its streaming profitability.
On Aug. 7, Disney shares dipped 4.5% after reporting better-than-expected Q3 results, posting adjusted EPS of $1.39 and revenue of $23.2 billion. Concerns over declining demand in its Parks, Experiences, and Products segment, with expected "mid-single-digit" declines in operating income from lower attendance and spending, particularly at domestic parks and Disneyland Paris.
Highlighting the contrast in performance, DIS' competitor, Comcast Corporation (CMCSA), has significantly underperformed both DIS and the broader market indexes. CMCSA has declined 2.4% in 2024 and soared 2.8% over the last 52 weeks.
Analysts are optimistic about DIS' prospects despite the weak price performance. The stock has a consensus rating of "Strong Buy" from 29 analysts in coverage. The mean price target of $125.52 reflects a 7.7% premium over current levels.
