Disney (DIS): Cutting Estimates On Iger Comments - Needham

Needham & Company analyst, Laura Martin, reiterated her Hold rating on shares of Walt Disney (NYSE: DIS) and cut 4Q16 estimates to reflect recent comments from CEO, Bob Iger, that FY16 would have only 52 weeks, 1 week less than 2015, resulting in $350mm lower operating income. A majority of that negative comparison is in the Cable Networks division and the balance is in Parks and Consumer Products.

The analyst is cutting 4Q16 operating income by $250mm, of which $216mm (86%) is Cable Nets, $21mm is Parks and $13mm is Consumer Products bringing 4Q16 revenue to $13.57B (up 0.5% y/y, 2% below previous estimates), Segment operating income to $3.1B (down 12% y/y, 7% below previous estimates), and EPS to $1.12 (down 7% y/y, 8% below previous estimates, well below the consensus estimate of $1.18).

Based on technical analysis, the analyst believes there is potential $2/share of upside to DIS’s near-term share price from here and $7 of potential downside.

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 $92.86 yesterday.

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