Disney (DIS): Taking Stock of Valuation After Recent Pullback and Growth Prospects

Walt Disney (DIS) shares have pulled back over the past month, with the stock slipping about 5%. Investors are watching for signs of stabilization as the company navigates a shifting media landscape and evolving revenue streams.

See our latest analysis for Walt Disney.

After a quiet stretch last year, Walt Disney’s share price has shifted gears in 2024, showing modest gains overall. Short-term momentum has faded over the last month despite earlier optimism, but the 1-year total shareholder return of about 21% suggests long-term investors have seen substantial rewards as the stock weaves through industry change.

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With Disney trading roughly 19% below consensus analyst price targets while showing only modest growth in revenue and profit, the question is whether value remains for buyers or if the market has already priced in future gains.

Most Popular Narrative: 15.8% Undervalued

With Walt Disney’s fair value from the most widely followed narrative set at $133.22, and the latest closing price at $112.14, the narrative points to meaningful upside. The stage is set for a valuation supported by global expansion plans and digital transformation.

The global expansion of Disney's cruise and theme park businesses, with major investments in new ships and park attractions, particularly in Asia and emerging markets, is positioned to capture increasing demand from rising middle class populations worldwide. This may boost future revenue and earnings growth across geographies.

Read the complete narrative.

What is the real reason behind this bullish price target? The underlying narrative is built upon ambitious international growth, digital reinvention, and profitability pivots that few expect from a legacy media giant. Want to uncover the single financial lever driving this double-digit upside? The full story reveals how fresh assumptions on revenue, margins, and future multiples could turn today’s price into a deep discount.

Result: Fair Value of $133.22 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the narrative faces meaningful risks, such as franchise fatigue and heavier content costs. These factors could materially limit future growth and margin expansion.

Find out about the key risks to this Walt Disney narrative.

Another View: Valuing Disney With the SWS DCF Model

While the analyst consensus suggests Walt Disney could be undervalued, the SWS DCF model tells a different story. Our DCF model estimates Disney’s fair value at $106.73, slightly below its current trading price. This suggests that some of the optimism may already be reflected in the stock. Is the market seeing something that the numbers are not showing yet?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Walt Disney for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Walt Disney Narrative

If you want to challenge these assumptions or take a different approach, you can easily develop your own perspective in just a few minutes. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Walt Disney.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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