Disney earnings preview: Can Disney + keep up its steamy pace to sustain the Magic Kingdom?


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Walt Disney Co. has deftly managed to navigate the pandemic despite being crippled by closed amusement parks and an indefinite hiatus in live-action productions. Fueled by its streaming service, Magic Kingdom DIS, + 0.18% should post respectable fiscal first quarter results on Thursday.

Still, how does Disney defend itself against companies like Apple Inc.’s AAPL, -0.40% Apple TV +, Netflix Inc.NFLX, -0.29%, Comcast Corp.’s CMCSA, -0.89% Peacock, Amazon.com Inc.’s AMZN, + 0.55% Prime Video, AT&T Inc.’s T, + 0.04% HBO Max, and others while Disney operates at less than full power? He offered many answers in December during a marathon investor day briefing. It rolled out a lineup of big-budget movies, including “Stripe and the Last Dragon” on March 5, which will premiere on its burgeoning streaming service and in theaters as part of a direct-to-consumer push. In the coming years, Disney + will host a fire hose of 10 new Marvel series, 10 new “Star Wars” series, 15 animated and live-action series from Pixar and Disney, and 15 Disney-Pixar films featuring the new name of Disney +. Original. As of December 2, Disney + had 86.8 million paying subscribers, and Disney expects that number to rise to 230 million to 260 million by the end of 2024. Including Hulu and ESPN +, the total direct-to-consumer subscribers across the world should reach 300 million to 350 million by the end of 2024. It could be a stretch for Disney + to reach 100 subscribers in the first quarter, but many analysts are looking for sustained growth. What to Expect Earnings: Analysts surveyed by FactSet expect an average loss of 33 cents per share, which would be a decrease of $ 1.53 per share in the first quarter of 2019. The estimate has plummeted from one cent per share on September 30th. Contributors to Estimize, a crowdsourcing platform that collects estimates from Wall Street analysts, as well as buyer analysts, fund managers, business executives, academics and others, also project a loss of -33 cents per share on average. Revenue: Analysts on average expect Disney to report $ 15.89 billion in first-quarter revenue, according to FactSet, down from $ 20.86 billion a year earlier. He estimates that taxpayers expect revenue of $ 15.89 billion. Stock Movement: As of Thursday, stocks are up 28% in the past 12 months, giving it a market value of $ 327 billion. The S&P 500 SPX Index, + 0.39% has risen 17% in the last year. What Analysts Say • “We now expect Disney + to end FQ1 with 95 million subscribers from the previous 90 million, and up from 86.8 million reported as of December 2, as we are encouraged by third-party data. According to Apptopia, the Disney + mobile MAUs have risen from 33 million as of December 2 to 50 million as of January 2, with substantial growth coming from Brazil and Mexico. ” – Alexia Quadrani, an analyst at JPMorgan, while maintaining an overweight rating and raising the price target to $ 210 from $ 175 on January 11. • “We were wrong… we were just blown away. [on investor day] by the depth of content that is created for Disney + (and the dollars behind it). Increasing content spending on Disney + to more than $ 8 billion by 2024 compared to the $ 4 billion target set just a year ago is a dramatic acceleration. ”- Lightshed Partners analyst Richard Greenfield raised the Disney’s rating to neutral since the sale on January 8. • “We maintain the purchase in differentiated assets, the direct consumer drive (Star / Star + launches and more Disney + markets in 2021; investment in content should also benefit consumer products / licenses and parks), and years after the COVID recovery in the parks (we expect spent demand on a lower cost base). ”- Truist Securities analyst Matthew Thornton maintains a rating purchase price and raises the target price to $ 195 from $ 175 on January 5.