Walt Disney (DIS) Sub Loss Disclosures Not New News - Wells Fargo

Wells Fargo analyst, Marci Ryvicker, stated that the sub losses disclosed in Walt Disney (NYSE: DIS) 10-K is not new information and that the lost profit may be less than professional investors expect.

Disney's 10-K shows 3MM sub losses for ESPN and 2MM sub losses for the Disney Channels in F'15 vs. F'14 (4MM for both in F'14 vs. F'13). However, these are ''Estimated domestic subscriber counts according to Nielsen Media Research'', which could overstate the sub losses by half (their guess).

On 8/4, Bob Iger made the following comments: ''ESPN has experienced some modest sub losses, although those have been less than reported by one of the prominent research firms. And the vast majority of them, 80%, were due to decreases in multi-channel households with only a small percentage from skinny packages.''

Based on these statements, and the analyst's belief that Nielsen could be off by 50%, she calculates real lost sub revenue of $150MM in F'15 vs. F'14 and $200MM in F'14 vs. F'3--for a two-year total of $350MM.

No changes to the Market Perform rating or valuation range.

For an analyst ratings summary and ratings history on Walt Disney click here. For more ratings news on Walt Disney click here.

Shares of Walt Disney closed at $115.13 yesterday.

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