Market Overview

Imperial Capital Upgrades Disney On 'Distinct' 2020 Catalysts

Share:
Imperial Capital Upgrades Disney On 'Distinct' 2020 Catalysts
Related DIS
Barron's Picks And Pans: Barrick Gold, Costco, Disney, GE And More
Hope Takes Flight: China Optimism Has Markets Looking Strong Ahead of Weekend
Disney: When 'Losing' Is The Right Thing To Do (Seeking Alpha)

After Walt Disney Co. (NYSE: DIS)'s strong fourth-quarter earnings report earlier this month, Imperial Capital said it expects that next year will be a transitional one for the entertainment conglomerate. 

The Analyst

Analyst David W. Miller upgraded Walt Disney from In-Line to Outperform and increased the price target from $113 to $129.

The Thesis

Walt Disney shares have shown conservative gains given the impact of its purchase of Twenty-First Century Fox Inc. (NASDAQ: FOXA) assets, Miller said in a Tuesday note. (See his track record here.) 

“We believe the reason for the tepid performance was/is due to questions from investors about the transaction, both structural and strategic, which DIS management either could not or would not answer at the time.”

Miller said he anticipates 2019 to be a transitional year as Disney seeks regulatory approvals tied to the Fox merger; continues its suspension of the buyback program; refinances existing merger debt; and hosts an upcoming analyst day.

"However, in 2020, we see shareholders benefiting from four distinct catalysts, and since DIS is a highly visible name and a Dow component, it would not surprise us to see the market price in these catalysts fairly quickly.”

The four catalysts are as follows, the analyst said: 

  • The company’s 2019 film slate, including titles such as "Wreck-It Ralph 2," "Mary Poppins," "Captain Marvel," "Dumbo," "Avengers," "Toy Story 4" and "The Lion King." 2020 will also feature sequels to "Kingsman," "X-Men," "Deadpool," "Fantastic Four" and "Avatar."
  • The opening of two "Star Wars" attractions. 
  • Pricing power in new over-the-top services.
  • Buybacks. 

Price Action

Walt Disney shares were trading 1 percent higher at $113.68 at the time of publication Tuesday.

Related Links:

Barclays Upgrades Disney On Streaming Service Optimism

How Disney Shares Trade After Earnings

Latest Ratings for DIS

DateFirmActionFromTo
Nov 2018Imperial CapitalUpgradesIn-LineOutperform
Nov 2018ArgusMaintainsBuyBuy
Oct 2018BarclaysUpgradesEqual-WeightOverweight

View More Analyst Ratings for DIS
View the Latest Analyst Ratings

Posted-In: Avatar Avengers David W Miller imperial capitalAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

 

Related Articles (DIS + FOXA)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
MDRXKeyBancUpgrades0.0
ANETNomuraUpgrades260.0
CNPRBC CapitalUpgrades34.0
FISVOppenheimerUpgrades88.0
FNDUBSUpgrades37.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
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.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Sprit Airlines Pops 15%, And Market Cycles Point Even Higher

How To Stop The IRS And Student Loans From Garnishing Your Social Security