Can Disney (dis) stock regain his magic, or is it a sinking ship?
The recent income of Walt Disney (Dis) gave us a good look at a company that navigated intense industrial shifts, and unfortunately things do not go smoothly. The entertainment powerhouse peak between 2012 and 2019, stimulated by the success of his Marvel, Star Wars and Pixar films, including the launch of Disney+ in 2019. In 2025, Disney's Fortunes changed despite a short deposit of outperformance after the COVID- 19 Pandemie a few years ago.
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In Q4 results published on 5 February, while the total income was magical by 5% on an annual basis up to $ 24.7 billion in its Q4 2024 results, Disney's Legacy TV decline and growth pins in its direct-to-consumer remain (DTC) Division formidable obstacles. Parks and experiences came through again as the most important engine of growth, but there are signs that the ship of Disney is taking on water while crossing rougher market seas.
Combine that with an overvalued stock price, despite the long -term lagging from colleagues and benchmarks, not to mention anemic capital efficiency, and I see more risk than reward at the current level.
PayPal Holdings (Pypl) Price and analysis in the past 5 years
Despite the fact that the shares have a small dividend and one of the most recognizable global brands with a long-term commercialization potential, the appreciation has gradually worsened since the COVID-19 Pandemie.
The linear TV networks from Disney continue to end – a trend that I have followed in the industry as more consumers cut the cord. This quarter, the linear TV income fell by 7% to $ 2.6 billion, while business income fell by 11% to $ 1 billion. If you have viewed the media room, this is not a shock. As you know, traditional TV is confronted with a structural decline while viewers come to streaming platforms.
In general, political advertisements issues Linear income gave a temporary raft, but lower impressions and overall string cut more than compensate for this profit. Disney's international side went worse, with income that decreased 31% after the shift from Star India activa to a joint venture with Reliance Industries. In my opinion we can expect further erosion in the division as consumers are increasingly satisfied with on-demand platforms.
Interestingly, Disney's management seems to be more focused on managing the decline of these assets instead of making significant changes, which reflects what an industrial conviction seems to be that the peak days of the linear TV are long over.
On the better side, the DTC division of Disney finally published a remarkable business profit, which yielded $ 293 million after a loss of $ 138 million last year. Topline figures also looked clear, with a turnover with 9% to $ 6 billion, powered by recent price increases and stronger advertising sales. Seeing Disney is profitable here is an important milestone, which indicates that management has finally discovered how to balance the costs in such a brutal space.
Walt Disney Income, Income AMD -Winmarge History
However, subscriber figures remain a mixed bag. Disney+ Core lost 700,000 subscribers to now have a total of 125 million. For Perspectief, Hulu recorded a modest growth from 3% to 53.6 million. Netflix (NFLX) still crushes Disney+ in a pure scale, with 301.6 million paying subscribers worldwide while they celebrate record -subscriber advertisements in the same calendar period (Q4 for Netflix).
In the meantime, Amazon Prime (Amzn) and Apple TV+ (AAPL) continue to expand, so that the market remains pressure while consumers are picky. So Disney can finally hit the wall in his efforts to grow his DTC division further.
Looking at Disney's Parks & Experiences Division and its figures separately, it is difficult to ignore the stability it offers for the wider company. Turnover is $ 9.4 billion, an increase of 3% on an annual basis, which reflects how deeply embedded Disney's theme parks are in the cultural substance.
And yet, a 5% dip in domestic business income, largely thanks to hurricane -related closures and costs linked to new cruise ships, indicates that growth is becoming more difficult. International parks did better, with an operational income with 28% on robust guest expenditure, but how much space is there for further revenue growth?
Walt Disney (DIS) Income History
The expenditure per head of the population is still robust visitors willing to pay a premium for the Disney experience but seems to be the presence. Hiking prices for an indefinite period are not exactly a long -term strategy.
While the new extensions of the cruise line may be able to catch some extra dollars, the launch of massive ships such as the Disney Treasure with Freefy -before investments, clearly becomes in the falling free cash flow in Q4 2024. In my opinion, Disney's Parks & Experiences can close to Hacking saturation his point in the short term and may even require further investments before the business unit returns to its majestic good times.
Given the soft results of Disney, the stock does not seem like a bargain to me, despite the lagging performance in the past year. You could claim that the market has already priced and streaming in most linear TV decreases, but I believe that there is more close risk if streaming growth does not move as quickly as hoped.
In the meantime, Disney's capital returns remain minimal. Both the dividend and the return are negligible. Together with Disney who is still acting on a forward p/e of about 20x, I am not forced to justify the implementation risks that are linked to the linear TV settlement and the heavy streaming struggle.
Walt Disney (Dis) Dividend Yield range from 2018 to 2025
Wall Street's prospects for Dis Stock seems more encouraging than mine. In New York, BBAI shares has a strong buy -consensus assessment based on 18 Buy, Six Hold and zero sales in the past three months. The average price target of Walt Disney of $ 128.32 per share implies an upward potential of 16% compared to current levels.
Walt Disney (DIS) stock forecast for the coming 12 months including a high, average and low price objective
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The different segments of Disney tell an extensive story about a company that tries to find its foot in a transformed media landscape. The stock still looks too expensive for a company that is confronted with uphill fights in linear TV, the growth of the DTC subscribers and the limitations of the park capacity.
My opinion is that Disney's good news, such as the Milestone of the DTC win, does not compensate for the harsh realities. So, although I would be happy to see new catalysts who really wake up, I cannot find a compelling reason to invest in this diversified entertainment and media company.
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