Disney (DIS) Looks for 'Wonderful' Q210 Earnings (CBS, NWSA, TWX, CVC)
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Shares of Disney (NYSE: DIS) are trading higher ahead of the company's second quarter earnings release, expected after the market closes Tuesday, May 11, 2010. Shares are up 5.27% to $35.18.
DIS is expected to post an EPS of $0.46 on revs of $8.39 billion. Last quarter, the company reported an adjusted EPS of $0.47, beating views by 9 cents. Revs for the quarter were also heavy, at $9.74 billion. For Q209, DIS posted an EPS of $0.43 and revs of $8.08 billion.
Shares of the company gained about 7.4% through Q210, from an opening price of $32.50 on January 4, 2010. DIS gained 43.8% through FY09, and 113% from recent lows of $15.10 on Marc 10, 2009.
Using a basic valuation, the stock is trading at a forward P/E of 17.6x FY10 EPS estimates. By comparison, CBS Corp. (NYSE: CBS) is going for 16x, News Corp. (Nasdaq: NWSA) is at 15.3x,, and Time Warner Inc. (TWX) is at 14.3x. Disney looks a little overvalued compared to others in the industry.
Data from Bloomberg shows that 16 analysts have a Buy rating on the stock, 13 have a Hold, and 3 recommend to Sell. The analyst average price target is $36.53, with a high of $43.00, and a low of $24.00.
News Through the Quarter
Hedge fund manager Stephen Mandel started a new stake in Disney at 7.44 million shares, as disclosed on his 13F filing with the U.S. SEC for the quarter ended December 31, 2009.
Disney pulled the plug on ABC7 for Cablevision (NYSE: CVC) subscribers, causing many to miss the first 15 minute of the Academy Awards on March 7. The two sides agreed on a deal, which wasn't disclosed to the public. Previously, CVC made a statement saying they paid $200 million to Disney per year for the rights to broadcast, and Disney was asking for $40 million more to continue broadcasting.
Disney's "Alice in Wonderland" came out in March, and utilized 3D technology offered on IMAX (Nasdaq: IMAX) theaters, the same that helped propel "Avatar" to be the largest grossing movie of all time.
Analyst Ratings Through the Quarter
In January, Janney Montgomery Scott downgraded DIS to Neutral from Buy, with a price target on the company of $34. Click Here for more color.
Soleil Securities initiates coverage with a Hold, and price target $30. Soleil says that it is a great company, but the growth rate doesn't justify a premium to its peers or the S&P 500.
February started with J.P. Morgan upgrading from Underweight to Neutral, with their price target increased from $28 to $30.
Jefferies & Co started with a Buy rating and $36 price target.
Early March had Bank of America Merrill Lynch upgrade DIS to Buy from Neutral, increasing their price target to $42 from $33. BofA noted that the company's risk/reward profile at the time was skewed "highly positive." The firm also added DIS to their "U.S. 1" list.
Summary
As previously mentioned, one big revenue source might be "Alice in Wonderland," which is currently approaching the $1 billion worldwide mark. Movie-goers, still hankering for more after the wildly successful "Avatar" may add that extra burst that may surprise analysts on the company.
Additionally, many media companies have reported increased spending by advertisers. Look for Disney to do the same. For the most part, their Media Networks segment is the big gainer, as Theme Park and Resorts revs, Studio Entertainment, and Consumer Products typically have shown flat-to-modest growth, having a slower rebound post-recession, though Studio Entertainment showed a gain in net income for FY09 Y/Y.
Currently, Disney's acquisition of Marvel is also looking pretty sweet, with features "Iron Man" and "Iron Man 2" bowling-over fans in the theaters.
The Walt Disney Co. is expected to release their Q210 earnings on Tuesday, May 11, 2010, at approximately 4:00pm EDT. Stay tuned to StreetInsider.com's Earnings section to see our analysis of the highly-anticipated quarterly results within seconds of their release.
DIS is expected to post an EPS of $0.46 on revs of $8.39 billion. Last quarter, the company reported an adjusted EPS of $0.47, beating views by 9 cents. Revs for the quarter were also heavy, at $9.74 billion. For Q209, DIS posted an EPS of $0.43 and revs of $8.08 billion.
Shares of the company gained about 7.4% through Q210, from an opening price of $32.50 on January 4, 2010. DIS gained 43.8% through FY09, and 113% from recent lows of $15.10 on Marc 10, 2009.
Using a basic valuation, the stock is trading at a forward P/E of 17.6x FY10 EPS estimates. By comparison, CBS Corp. (NYSE: CBS) is going for 16x, News Corp. (Nasdaq: NWSA) is at 15.3x,, and Time Warner Inc. (TWX) is at 14.3x. Disney looks a little overvalued compared to others in the industry.
Data from Bloomberg shows that 16 analysts have a Buy rating on the stock, 13 have a Hold, and 3 recommend to Sell. The analyst average price target is $36.53, with a high of $43.00, and a low of $24.00.
News Through the Quarter
Hedge fund manager Stephen Mandel started a new stake in Disney at 7.44 million shares, as disclosed on his 13F filing with the U.S. SEC for the quarter ended December 31, 2009.
Disney pulled the plug on ABC7 for Cablevision (NYSE: CVC) subscribers, causing many to miss the first 15 minute of the Academy Awards on March 7. The two sides agreed on a deal, which wasn't disclosed to the public. Previously, CVC made a statement saying they paid $200 million to Disney per year for the rights to broadcast, and Disney was asking for $40 million more to continue broadcasting.
Disney's "Alice in Wonderland" came out in March, and utilized 3D technology offered on IMAX (Nasdaq: IMAX) theaters, the same that helped propel "Avatar" to be the largest grossing movie of all time.
Analyst Ratings Through the Quarter
In January, Janney Montgomery Scott downgraded DIS to Neutral from Buy, with a price target on the company of $34. Click Here for more color.
Soleil Securities initiates coverage with a Hold, and price target $30. Soleil says that it is a great company, but the growth rate doesn't justify a premium to its peers or the S&P 500.
February started with J.P. Morgan upgrading from Underweight to Neutral, with their price target increased from $28 to $30.
Jefferies & Co started with a Buy rating and $36 price target.
Early March had Bank of America Merrill Lynch upgrade DIS to Buy from Neutral, increasing their price target to $42 from $33. BofA noted that the company's risk/reward profile at the time was skewed "highly positive." The firm also added DIS to their "U.S. 1" list.
Summary
As previously mentioned, one big revenue source might be "Alice in Wonderland," which is currently approaching the $1 billion worldwide mark. Movie-goers, still hankering for more after the wildly successful "Avatar" may add that extra burst that may surprise analysts on the company.
Additionally, many media companies have reported increased spending by advertisers. Look for Disney to do the same. For the most part, their Media Networks segment is the big gainer, as Theme Park and Resorts revs, Studio Entertainment, and Consumer Products typically have shown flat-to-modest growth, having a slower rebound post-recession, though Studio Entertainment showed a gain in net income for FY09 Y/Y.
Currently, Disney's acquisition of Marvel is also looking pretty sweet, with features "Iron Man" and "Iron Man 2" bowling-over fans in the theaters.
The Walt Disney Co. is expected to release their Q210 earnings on Tuesday, May 11, 2010, at approximately 4:00pm EDT. Stay tuned to StreetInsider.com's Earnings section to see our analysis of the highly-anticipated quarterly results within seconds of their release.
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