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- Disney May Climb above $100
Disney May Climb above $100
Without unidirectional price motion on the foreign exchange market, investors are increasingly focused on short-term opportunities in stocks. Crowds are searching for lonely islets of corporate efficiency. The latest quarterly report provided by Walt Disney Co showed that the House of Mouse claims to become recognized as one of these growth points.
The entertainment giant's value jumped by 6.88% in one trading session on November 9, following months of narrow range trading near its multi-year lows. The mood has changed for the better as Disneylands and branded cruise boats worldwide, together with new 7 million subscribers on Disney+ in the third quarter, helped much to expand its business returns. Experiences division was 31% more effective than a year ago, pointing to the faster-than-anticipated post-COVID recovery. Subscription prices increase has not scared away parents aiming to please their children. Guardians of the Galaxy Volume 3, the Little Mermaid, Ashoka and Pixar's Elemental were added to the list of the most watched content on Disney+. A Korean series, Moving, has also become a breakout hit. The upcoming Christmas season could make both options even more attractive.
Reported EPS (equity per share) exceeded consensus estimates by 16.7%, even though it was nearly 20% lower than in the previous quarter. A shortfall of ad sales on Disney's streaming channels could not overshadow excellent performance in direct-to-consumer profit generation. Ad-supported products rose by 2 million subscriptions to a total of 5.2 million, while more than a half of Q4 new U.S. subscribers chose an ad-supported Disney+ option. These are great foundations for the future. Disney production's theatrical slate in 2024 is filled by popular franchises like Deadpool 3 featuring Wolverine, Kingdom of the Planet Apes and Inside Out 2, as well as Mufasa: The Lion King and sequels from Toy Story, Frozen, Zootopia and Avatar franchises, which are all reportedly in the works.
The company's CEO, Robert Iger, highlighted what he called as "the four key building opportunities that will be central to our success", like achieving significant and sustained profitability in the streaming business, building ESPN TV into the preeminent digital sports platform, improving the output and economics of film studios and turbocharging growth in Disney's experiences business.
Disney's streaming unit already turned to provide a Q3 operating income of $236 million after several quarters of losses due to excessive costs, while its sport channels got +14% of profit compared to 2022. Disney saved $7.5 billion of its usual costs this year. Therefore, I would dare to bet on further price climbing to some third-digits numbers, after testing the next target at $100.
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