Is Disney Stock Still a Buy After Earnings?
Walt Disney stock is down Wednesday after the entertainment and media company beat fiscal 2025 first-quarter expectations. Here's what you need to know.
Walt Disney (DIS) stock is down Wednesday even though the entertainment and media company beat top- and bottom-line expectations for its fiscal 2025 first quarter and reiterated its full-year outlook.
In the quarter ending December 28, Disney's revenue increased 4.8% year over year to $24.7 billion, led by 8.9% growth in its Entertainment segment to $10.9 billion. Earnings per share (EPS) rose 44.3% from the year-ago period to $1.76.
"Our results this quarter demonstrate Disney's creative and financial strength as we advanced the strategic initiatives set in motion over the past two years," said CEO Bob Iger in a statement.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Iger cited "outstanding box office performance" during the quarter, including the top three movies of 2024, and improved profitability of Disney's Entertainment direct-to-consumer (DTC) streaming businesses.
Indeed, it's the first time Disney has reported a first-quarter profit for its direct-to-consumer segment. And fewer subscribers left than anticipated following a price increase in October.
The CEO also noted "an important step to advance ESPN's digital strategy by adding an ESPN tile on Disney+" and strategic investments in the "enduring appeal" of Disney's Experiences segment.
The results topped analysts' expectations. Wall Street was anticipating revenue of $24.6 billion and earnings of $1.45 per share, according to CNBC.
Disney ended the first quarter with 124.6 million Disney+ subscribers, down from 125.3 million at the end of the fourth quarter, and 53.6 million Hulu subscribers, up from 52 million.
Disney's reiterated outlook for 2025 calls for high-single digit EPS growth compared to 2024.
"Overall, this quarter proved to be a strong start to the fiscal year," Iger added, "and we remain confident in our strategy for continued growth."
Is Disney stock a buy, sell or hold?
Disney stock continues to recover after a rough patch during the middle of 2024 and has outperformed the S&P 500 with a 27% gain vs 14% for the index over the trailing six months. And Wall Street is bullish on the Dow Jones stock.
According to S&P Global Market Intelligence, the average analyst target price for DIS stock is $124.56, representing implied upside of more than 10% to current levels. And the consensus recommendation is a Buy.
Financial services firm BofA Securities is one of the most bullish outfits on the blue chip stock with a Buy rating and $140 price target.
"DIS reported a solid fiscal first quarter with operating income coming in above our expectations while revenue was modestly below," writes BofA Securities analyst Jessica Reif Ehrlich in a note this morning.
According to Ehrlich, near-term catalysts for Disney include a profitability inflection in DTC and a reacceleration in the Parks business as well as a strong film slate that drives growth across DTC, Parks and Consumer Products.
Related Content
-
Samsung Galaxy S25 Ultra for $4.99 a Month: A Closer Look at Verizon’s DealVerizon’s aggressive pricing makes Samsung’s top-tier phone tempting, but the real cost depends on your plan and how long you stay.
-
I'm 59 with $1.7 million saved and lost my job. Should I retire?We asked professional wealth planners for advice.
-
4 Times to Say Yes to a Roth Conversion and 4 Times to Say NoRoth conversions should never be done on a whim — they're a product of careful timing and long-term tax considerations. So how can you tell whether to go ahead?
-
A Wealth Adviser Explains: 4 Times I'd Give the Green Light for a Roth Conversion (and 4 Times I'd Say It's a No-Go)
Roth conversions should never be done on a whim — they're a product of careful timing and long-term tax considerations. So how can you tell whether to go ahead?
-
A 4-Step Anxiety-Reducing Retirement Road Map, From a Financial AdviserThis helpful process covers everything from assessing your current finances and risks to implementing and managing your personalized retirement income plan.
-
The $183,000 RMD Shock: Why Roth Conversions in Your 70s Can Be RiskyConverting retirement funds to a Roth is a smart strategy for many, but the older you are, the less time you have to recover the tax bite from the conversion.
-
A Financial Pro Breaks Retirement Planning Into 5 Manageable PiecesThis retirement plan focuses on five key areas — income generation, tax management, asset withdrawals, planning for big expenses and health care, and legacy.
-
4 Financial To-Dos to Finish 2025 Strong and Start 2026 on Solid GroundDon't overlook these important year-end check-ins. Missed opportunities and avoidable mistakes could end up costing you if you're not paying attention.
-
Nasdaq Leads as Tech Stages Late-Week Comeback: Stock Market TodayOracle stock boosted the tech sector on Friday after the company became co-owner of TikTok's U.S. operations.
-
Are You Putting Yourself Last? The Cost Could Be Your Retirement SecurityIf you're part of the sandwich generation, it's critical that you don't let the needs of your aging parents come at the expense of your future.
-
I'm an Insurance Pro: It's Time to Prepare for Natural Disasters Like They Could Happen to YouYou can no longer have the mindset that "that won't happen here." Because it absolutely could. As we head into 2026, consider making a disaster plan.
