Disney (DIS) Valuation in Focus After Strong Earnings, Higher Dividends, and New Buyback Plans

Walt Disney (DIS) just posted fourth-quarter and full-year earnings that saw net income and earnings per share jump sharply, even as revenue dipped slightly in the latest quarter. Alongside the strong results, management announced fresh share buybacks and higher dividends. This brings renewed attention to Disney’s strategic path forward.

See our latest analysis for Walt Disney.

Disney’s strong rebound in net income and commitment to buybacks have given shareholders something to cheer about, but the share price continues to reflect a complicated story. This year, the share price return has lagged at -5.9%, and the total shareholder return over the last year remains down by 9.3%. With management highlighting growth in experiences, streaming, and sports, sentiment could shift if operational gains translate into sustained momentum.

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With improved earnings, capital returns, and a pivotal streaming strategy, investors are left to consider whether Disney’s latest momentum signals an undervalued stock or if the market has already priced in future growth potential.

Most Popular Narrative: 20.7% Undervalued

According to Cashflow_Queen’s widely followed fairness estimate, Disney’s fair value lands markedly above the latest closing price. With a discount of nearly 21% to this target, expectations of streaming, sports, and experiences driving growth are front and center.

“The next five years are poised to be transformative. ESPN’s NFL-driven streaming dominance, streaming scaling into multibillion-dollar profits, parks and cruises expanding globally, and blockbuster releases fueling the IP machine. Disney could see sustained double-digit EPS growth and a re-rating of the stock as sports transforms from a cable anchor into a digital rocket booster.”

Read the complete narrative.

Ever wondered what numbers support this bullish target? A forecast built on future cash flow strength, rising margins, and multi-segment synergy. The math behind this fair value is not what most investors expect. Find out what sets this projection apart.

Result: Fair Value of $131.50 (UNDERVALUED)

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

However, escalating sports rights costs or setbacks in streaming growth could still challenge Disney’s valuation and slow its transformation story.

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

Build Your Own Walt Disney Narrative

If this perspective does not align with your view or you prefer to analyze the data independently, building your own narrative is simple and fast. Get started and Do it your way.

A good starting point is our analysis highlighting 4 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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