CFRA Reiterates Buy Opinion On Shares Of The Walt Disney Company

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We believe DIS has a rigorous plan to drive future growth and enterprise value leading to the April 3 shareholder meeting. We raise our target by $19 to $139 on a forward TEV/EBITDA of 14.1x our 2024 EBITDA estimate of $1.46B. Our multiple is well below the five-year historic average of 22.5x, but a premium to linear network peers that trade at high-single digits. We think DIS deserves a higher valuation for Experiences (parks and cruises lines) at 37% of FY 2023 (Sep.) revenue and 59% of operating income and leading Sports franchises (18%, 33%) with ESPN networks. The turnaround story centers around Entertainment’s (45%, 7%) film, television networks, and direct-to-consumer units with Disney+, ESPN+, and Hulu. We like that DIS is driving efficient content spending, as well as its $7.5B expense reduction plan and new partnerships in gaming and sports gambling. DIS plans to buy the 33% minority interest from Comcast (CMCSA 42 ****), which we think may cost $10.0B-$11.5B, but should benefit the Disney+ bundle.

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