BofA On Disney: Global OTT Expansion Plans At Risk

Five executives from Walt Disney Co’s DIS 5 Star India business have announced their resignations, adding uncertainty and elevating risk to the company’s global over-the-top expansion plans, according to BofA Securities.

The Walt Disney Analyst: Jessica Reif Ehrlich maintained a Buy rating on Disney with a $146 price target. 

The Walt Disney Thesis: The company is expected to provide details of its Star-branded international entertainment OTT offering — which is scheduled for a 2021 launch — during its Dec. 10 analyst day, Ehrlich said in a Tuesday note. 

“In our view the departures of the Star executives (who have had tremendous success) comes as a surprise, creating uncertainty around the strategic direction and a management void at Star,” the analyst said. 

"Despite near term COVID pressures, we believe DIS is ultimately well positioned to grow from a faster Disney+ rollout, launch of a Star branded intl. OTT offering in CY21E and LT theme park margin potential."

DIS Price Action: Shares of Walt Disney were trading 3.43% higher at $124.25 at last check Tuesday.

Courtesy photo.

Posted In: BofA SecuritiesJessica Reif EhrlichAnalyst ColorPrice TargetReiterationAnalyst Ratings

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