Disney Beats Street But Slides On TV Business
Walt Disney Co (NYSE: DIS) reported Q1 earnings at 4:15 p.m. EST Tuesday, with EPS coming in ahead of the Street ($1.63 vs. est. $1.45) and sales ahead of estimates as well ($15.24 billion vs. est. $14. 74 billion).
The EPS/Revenue results came in much closer to Estimize consensus.
Also of note, Disney recorded a 13 cent per share gain from Vice, which the company bought into late last year. According to Fortune, Disney "previously invested $200 million in Vice in November" and then invested another $200 million in December, totaling Vice's valuation at more than $4 billion and making Disney the owner of almost one-fifth of the publisher.
Unfortunately for investors, shares fell in the after hours session amid disappointing data related to ESPN and Disney's TV network business. Cable network profit fell 5 percent because of a "decrease at ESPN." That number was -1 percent a year ago.
According to Trefis, 30 percent of Disney's revenue comes from its cable networks, second only to the company's theme park segment.
The largest percentage of Disney's EBITDA is derived from cable -- 40 percent. That reliance partially explains investors' bearishness.
The Polls Are Closed: Readers Like Disney
While shares have fallen from $120 to $90 since November 2015, investor sentiment remains strong.
Benzinga polled the crowd via Twitter throughout the day, posing the question, "Will today's Q1 earnings report spark a turnaround?"
With 115 participants the results came in as follows:
- 33 percent answered "yes (long-term)"
- 26 percent answered "yes (short-term)"
- 41 percent answered "no"
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