Disney shares started off strong in 2024 but have since lagged behind the market, leaving investors wondering if there is still hope for a fairy-tale finish. After reaching a peak in March with a 37% increase, Disney’s stock performance has cooled off, now trading just 6% higher than at the start of the year. However, despite this setback, there are several reasons to believe that Disney shares can bounce back in the second half of the year.
One of the factors working in Disney’s favor is its financial outlook. Analysts predict a modest 3% increase in revenue for the current fiscal year, with a more robust 5% growth expected in fiscal 2025. On the profitability front, Wall Street experts are forecasting a significant 26% jump in earnings for this year, followed by continued double-digit gains in the next fiscal year.
One of the key drivers of Disney’s future growth is its streaming business, led by the popular Disney+ platform. After facing losses in the past, Disney’s direct-to-consumer streaming segment is now on track to turn a profit in the upcoming quarters. Additionally, Disney’s recent success at the box office with hits like “Inside Out 2” reaching over $1 billion in global ticket sales is a positive sign for the company’s entertainment division. With a strong lineup of releases scheduled for the remainder of the year, including highly anticipated films like Marvel’s “Deadpool & Wolverine,” Disney’s box office performance is poised for a comeback.
Looking ahead, Disney’s upcoming fiscal third-quarter results in August will be a key event to watch. Following the conclusion of a proxy battle earlier in the year, investors will be eager to see how Disney’s financial performance unfolds. Despite challenges in the streaming and theme park segments, Disney’s strategic initiatives, such as the rebranding of its Lightning Lane Multi Pass premium queue service, are expected to drive growth in the future.
Moreover, Disney’s D23 event and the release of “Alien: Romulus” in August are anticipated to generate excitement among fans and investors alike. With Disney shares trading below $100 and trailing behind the market, there is potential for a turnaround in the company’s stock performance. As Disney gears up for a strong finish to the year, investors may find renewed optimism in the entertainment giant’s prospects.
In conclusion, while Disney’s stock has faced challenges in 2024, there are reasons to remain optimistic about its future performance. With a solid financial outlook, promising developments in its streaming and entertainment divisions, and upcoming events that could drive growth, Disney has the potential to stage a comeback in the second half of the year. As investors await the company’s fiscal third-quarter results and exciting new releases, the possibility of a fairy-tale ending for Disney shares remains within reach.
Source: https://www.fool.com/investing/2024/07/22/will-disney-stock-really-lose-to-the-market-for-th/
Footnotes:
– https://www.fool.com/quote/nyse/dis/
– https://www.fool.com/investing/2024/05/07/3-reasons-why-disney-is-the-hottest-dow-stock-in-2/
– https://www.fool.com/quote/djindices/%5Edji/
– https://www.fool.com/investing/2024/06/25/is-animation-saving-the-multiplex-for-investors/
– https://www.fool.com/investing/2024/05/30/did-nelson-peltz-win-the-disney-proxy-battle/
– https://www.fool.com/investing/stock-market/market-sectors/communication/entertainment-stocks/
