Why Walt Disney (DIS) Outpaced the Stock Market Today

Walt Disney (DIS) ended the recent trading session at $121.46, demonstrating a +1.71% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 0.8%. Meanwhile, the Dow experienced a rise of 0.94%, and the technology-dominated Nasdaq saw an increase of 0.97%.

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The entertainment company's stock has climbed by 7.08% in the past month, exceeding the Consumer Discretionary sector's gain of 4.49% and the S&P 500's gain of 5.12%.

Analysts and investors alike will be keeping a close eye on the performance of Walt Disney in its upcoming earnings disclosure. On that day, Walt Disney is projected to report earnings of $1.45 per share, which would represent year-over-year growth of 4.32%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $23.56 billion, up 1.73% from the year-ago period.

DIS's full-year Zacks Consensus Estimates are calling for earnings of $5.76 per share and revenue of $94.89 billion. These results would represent year-over-year changes of +15.9% and +3.86%, respectively.

Investors might also notice recent changes to analyst estimates for Walt Disney. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

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 last 30 days, the Zacks Consensus EPS estimate has moved 0.01% lower. Right now, Walt Disney possesses a Zacks Rank of #3 (Hold).

Investors should also note Walt Disney's current valuation metrics, including its Forward P/E ratio of 20.72. This expresses a discount compared to the average Forward P/E of 21.45 of its industry.

We can additionally observe that DIS currently boasts a PEG ratio of 1.75. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. By the end of yesterday's trading, the Media Conglomerates industry had an average PEG ratio of 2.19.

The Media Conglomerates industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 182, finds itself in the bottom 27% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

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The Walt Disney Company (DIS) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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