BMO Raises Walt Disney Price Target Following FY4Q14 Results


In a research report issued today, BMO analyst Daniel Salmon maintained an Outperform rating on Walt Disney Company (NYSE:DIS) and slightly raised his price target to $100 (from $96), following the company’s earnings results, posting EPS of $0.89 that was slightly below BMO’s $0.91, but above consensus of $0.88.

Salmon wrote, “With shares having rallied 13% over the past 15 trading days, results were not the blowout needed to keep the stock working in the near-term, and it pulled back in the after-market. None of that disrupts our long-term thesis, which is underpinned by premium content franchises and technology leadership.”

The analyst added, “Looking ahead, we see the following potential catalysts: 1) strong consumer products revenue through the holiday period (including Halloween) lead by Frozen, and Infinity 2.0 supporting the Interactive segment; 2) ramping margin contribution from MyMagic+ in domestic Parks; 3) relative ad outperformance due to solid ABC ratings (scatter pacing +12% vs Upfront) and a strong lineup of NFL and NCAA football (including the first playoffs) on both broadcast and ESPN; 4) the return of film output from Pixar (Inside Out next June, and DIS also announced Toy Story 4 for June 2017) and 21 tent-pole films from the various studios over the next three years, versus only 13 in the last three; 5) our expectation for a re-upped buyback authorization, and; 6) an extra 53rd week in F2015. After a very strong year of 27% EPS growth, we feel these factors could provide upside to our current expectation for only 8% growth in F2015.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Daniel Salmon has a total average return of 12.5% and a 75.7% success rate. Salmon has a 21.1% average return when recommending DIS, and is ranked #466 out of 3388 analysts.

 

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