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

Zacks Equity Research

In the latest trading session, Walt Disney (DIS) closed at $140.84, marking a +0.71% move from the previous day. This change outpaced the S&P 500's 0.28% gain on the day. Meanwhile, the Dow gained 0.07%, and the Nasdaq, a tech-heavy index, added 0.71%.

Prior to today's trading, shares of the entertainment company had lost 1.53% over the past month. This has lagged the Consumer Discretionary sector's loss of 0.41% and the S&P 500's gain of 1.93% in that time.

Investors will be hoping for strength from DIS as it approaches its next earnings release, which is expected to be August 6, 2019. The company is expected to report EPS of $1.76, down 5.88% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $21.68 billion, up 42.35% from the year-ago period.

DIS's full-year Zacks Consensus Estimates are calling for earnings of $6.57 per share and revenue of $71.66 billion. These results would represent year-over-year changes of -7.2% and +20.58%, respectively.

Investors might also notice recent changes to analyst estimates for DIS. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Over the past month, the Zacks Consensus EPS estimate has moved 0.9% lower. DIS currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, DIS is holding a Forward P/E ratio of 21.27. This represents a premium compared to its industry's average Forward P/E of 15.55.

It is also worth noting that DIS currently has a PEG ratio of 4.22. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. DIS's industry had an average PEG ratio of 2.63 as of yesterday's close.

The Media Conglomerates industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 102, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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