Market Overview

Once Again, Parks Are The Happiest Places In Disney's Quarter

Share:
Once Again, Parks Are The Happiest Places In Disney's Quarter

Walt Disney Co (NYSE: DIS) reported Thursday its fiscal fourth-quarter earnings in which all segments showed signs of weakness except for its Parks unit.

The Analyst

UBS analyst John Hodulik.

The Rating

Hodulik maintains a Buy rating on Disney's stock with an unchanged $122 price target.

The Thesis

Disney's Theme Parks segment was impacted by Hurricane Irma yet still reported revenue of $746 million, which exceeded the Street's estimate of $735 million, Hodulik said in a note. The company also said it will increase its capital expenditures in the Theme Parks unit by $1 billion, which may be a prudent investment since Theme Parks was the only segment that didn't come in "light" in the quarter.

Aside from Theme Parks, the Media Net segment reported an operating income of $1.475 billion, which was short of the $1.58 billion the Street was expecting and the $1.516 billion the analyst was modeling. But there were a few encouraging signs, including an improvement in subscriber declines to -3 percent from -3.5 percent in the prior quarter. Affiliate revenue also accelerated from 2 percent in the prior quarter to 4 percent.

Price Action

Hodulik said Disney's stock is trading at 16.2x CY18E P/E, which is a premium compared to a 10-year average of 15.4x. The stock is also trading at discount of around 10 percent to the S&P 500 index versus a historical premium of 10 percent.

Shares of Disney were trading higher by more than 2 percent at $105.49 Friday.

Related Links:

Disney Shanghai And The True Growth Driver For The House Of Mouse

Disney's Streaming App Pricing Will Cost 'Significantly Less Than Netflix'

Posted-In: DIsney Parks John Hodulik UBSAnalyst Color Analyst Ratings Best of Benzinga

 

Related Articles (DIS)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
IINDoughertyAssumes34.0
PNRJefferiesInitiates Coverage On
YYUBSUpgrades
ROKUOppenheimerMaintains155.0
IPHIBank of AmericaMaintains80.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com

What Wall Street Thinks Of Nvidia's Huge Quarter

Instagram Stories: Anything Snap Can Do, We Can Do Better