Goldman Sees Streaming Momentum, Summer Travel Bookings Supporting Disney Outlook

Walt Disney Co (NYSE:DIS) suffered a setback with Snow White delivering a disappointing box office performance in its opening weekend.

The company is now preparing to report its fiscal second-quarter results.

Walt Disney is likely to report quarterly earnings of $1.18 per share, missing consensus of $1.21 per share, on revenue of $23.1 billion, versus consensus of $23.2 billion, according to a Wednesday note from Goldman Sachs.

The Walt Disney Analyst: : Analyst Michael Ng maintained a Buy rating and price target of $140.

The Walt Disney Thesis: The direct-to-consumer (DTC) segment is likely to have benefited from “Mufasa: The Lion King,”
“Moana 2,” SC+ and promotional activity, "as well as the first full-quarter of price increases implemented in October 2024," Ng said in the note.

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"We continue to expect upside to F2025E DTC EBIT, led by better-than-expected opex management, as well as benefits from paid sharing initiatives and a strong content slate with DTC making progress toward its 10% (ex Hulu Live) margin target in F2026," he added.

Domestic theme park attendance is likely to have declined by 1% year-on-year due to the Easter shift and natural disasters, the analyst stated. "We're encouraged by the growth in summer bookings despite recent softness in select travel datapoints and competition from Epic Universe," he wrote.

Sports could report additional expenses of $150 million, including $100 million in sports cost inflation and $50 million from the Venu write-off, Ng said.

"We view DIS as a high quality EPS compounder at an undemanding valuation," the analyst wrote.

DIS Price Action: Shares of Walt Disney had declined by 0.76% to $100.83 at the time of publication on Wednesday.

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