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Walt Disney (DIS) Outpaces Stock Market Gains: What You Should Know

Walt Disney (DIS) closed the most recent trading day at $120.90, moving +1.89% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.91%. At the same time, the Dow added 0.85%, and the tech-heavy Nasdaq gained 0.59%.

Heading into today, shares of the entertainment company had gained 0.19% over the past month, lagging the Consumer Discretionary sector's gain of 4.53% and the S&P 500's gain of 5.26% in that time.

Investors will be hoping for strength from DIS as it approaches its next earnings release, which is expected to be August 4, 2020. On that day, DIS is projected to report earnings of -$0.43 per share, which would represent a year-over-year decline of 131.85%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.65 billion, down 37.5% from the year-ago period.

DIS's full-year Zacks Consensus Estimates are calling for earnings of $1.44 per share and revenue of $66.96 billion. These results would represent year-over-year changes of -75.04% and -3.75%, respectively.

Any recent changes to analyst estimates for DIS should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 13.27% lower. DIS currently has a Zacks Rank of #5 (Strong Sell).

Investors should also note DIS's current valuation metrics, including its Forward P/E ratio of 82.5. Its industry sports an average Forward P/E of 50.37, so we one might conclude that DIS is trading at a premium comparatively.

It is also worth noting that DIS currently has a PEG ratio of 13.15. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Media Conglomerates stocks are, on average, holding a PEG ratio of 13.15 based on yesterday's closing prices.

The Media Conglomerates industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 240, which puts it in the bottom 6% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow DIS in the coming trading sessions, be sure to utilize Zacks.com.


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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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