Walt Disney Upgraded to “Buy” at Citigroup (DIS)

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Citigroup upgraded The Walt Disney Company ( DIS ) on Monday due to higher 2014 estimates.

The Citigroup analysts upgraded the company from "Neutral" to "Buy" and boosted the price target from $50 to $54. The new target is a +14.7% upside from Friday's closing price of $47.06.

Citigroup noted, "During fiscal 2013, Disney acquired Lucasfilm ($4 billion) and will invest significantly in Parks ($500 million of opex investment). Together, these two items will conspire to push 2013 EPS downward. As such, our 2013 EPS moves from $3.38 to $3.29. This suggests that Disney's 2013 EPS apt to grow just 7% this fiscal year. … We apply a 14x P/E multiple to Disney's fiscal 2014 EPS of $3.83 to arrive at our $54 price target, up from $50 previously. As such, we're upgrading Disney from Neutral to Buy."

Walt Disney shares were up 69 cents, or +1.47%, in premarket trading on Monday.

The Bottom Line
Shares of The Walt Disney Company ( DIS ) have a 1.27% dividend yield, based on Friday's closing stock price of $47.06. The stock has technical support in the $44-$45 price area. If the shares can firm up, we see overhead resistance around the $50-$51 price levels.

The Walt Disney Company ( DIS ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing , Stocks

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