Market Overview

Shanghai Disney: JPMorgan Deep Dives The House Of Mouse Theme Parks

Shanghai Disney: JPMorgan Deep Dives The House Of Mouse Theme Parks
Related DIS
Bernstein: Lionsgate Is David In A Sea Of Goliaths
Heartbreak And Desire: 11 Of Our Favorite Wall Street Love Stories
Stocks To Watch: Investors Recharge After Soothing Fedspeak (Seeking Alpha)

Walt Disney Co (NYSE: DIS) is expected to open its brand new Shanghai Disney Resort in mid-June, and J.P. Morgan analyst Alexia Quadrani believes the park will provide a shot in the arm for Disney’s international business.

According to Quadrani, about 300 million people live within a three-hour travel radius of the new park. Her preliminary conservative estimates are that the park will host abot 12.5 million guests in its first year of operation which will spend an average of about $70 each per visit. In addition, J.P. Morgan is predicting hotel occupancy of 75 percent and average room guest spend of $325.

Overall, J.P. Morgan projects that Shanghai Disney will generate roughly $1 billion in revenue and $50 million in operating income in fiscal 2017, numbers which will continue to grow in time.

Related Link: Zero Hedge 'Unmasked'? There's More To The Story

“With ongoing healthy domestic trends and the opening of Shanghai Disney Resort likely to fuel international growth over time, we are bullish on this division and expect a F2015-F2017E domestic operating income CAGR at ~11% with margins expanding ~230bps and international operating income growth from -$45m to $220m with further margin expansion over time,” Quadrani explains.

J.P. Morgan maintains its Overweight rating on Disney and names it one of the firm’s top media stock picks.

Disclosure: the author holds no position in the stocks mentioned.

Latest Ratings for DIS

Feb 2018BMO CapitalMaintainsUnderperformUnderperform
Jan 2018Morgan StanleyMaintainsOverweightOverweight
Jan 2018Loop CapitalMaintainsHoldHold

View More Analyst Ratings for DIS
View the Latest Analyst Ratings

Posted-In: Analyst Color Long Ideas Top Stories Analyst Ratings Trading Ideas Best of Benzinga


Related Articles (DIS)

View Comments and Join the Discussion!