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UBS On Disney: 'Seeing Stars...Wars'

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UBS On Disney: 'Seeing Stars...Wars'

In a report published Monday, analysts at UBS maintained their Buy rating on Walt Disney Co (NYSE: DIS), while raising the price target from $116 to $125. The FY15 estimates have also been raised following the better than anticipated performance of "Cinderella" and "Avengers: Age of Ultron."

The analysts expect the company to benefit from the digital sales of the first six "Star Wars" films. In addition, the worldwide box office sales of "Star Wars: The Force Awakens," as well as royalty inputs from Theme Parks, have led the analysts to raise their estimates for FY16 as well. UBS now expects the company to deliver EPS growth of 16 percent through 2015 and 2016.

Related Link: 'Avengers: Age Of Ultron' Scores 2nd-Best Opening Weekend Of All Time

UBS expects affiliate revenue growth, ad revenue, U.S. parks attendance and parks margins to drive the company's results for the quarter. According to the analysts, the key questions that management would need to answer going forward would focus on "Verizon sports tier / skinny bundles; OTT, capital deployment going forward (company quickly becoming over-capitalized), impact of Fx and oil prices on Parks attendance and when Fx hedges roll off, economics underlying Star Wars and Shanghai park, state of TV ad market."

The analysts believe that the management's take on the F3Q hotel bookings would also be crucial.

Shares of Disney recently traded at $111.20, up 0.64 percent. Shares are up more than 18 percent year-to-date.

Latest Ratings for DIS

DateFirmActionFromTo
Oct 2020MoffettNathansonMaintainsNeutral
Sep 2020Deutsche BankUpgradesHoldBuy
Aug 2020CitigroupMaintainsBuy

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