Reasons To Go Long On Walt Disney Stock

The Walt Disney Company (DIS) has just been upgraded to A+ status by the Morningstar credit ratings agency. This effectively means that Walt Disney offers creditors and investors a low default risk profile. The Walt Disney Company was trading at $103.78 towards the end of the trading session on Monday, 5 October 2015. The 52-week range for the company is $78.54 on the low end and $122.08 on the high end. The company’s market capitalisation is $175.23 billion, with a price-earnings ratio of 21.61 and earnings per share of 4.80. The bump up on the credit rating added fresh new impetus to upwards pressure on the stock price, which has suffered in recent weeks. The company’s 50-day moving average (MA) price is $102.30, and Walt Disney Company has a 200-day moving average of $109.03.

The last time the Walt Disney Co. issued its quarterly earnings reports was on 4 August 2015. The earnings per share at that juncture were $1.45, $0.03 higher than Thomson Reuters’ expectations. Year-on-year, the quarterly EPS were substantially higher than the 2014 figures which came in at $1.28 per share. The consensus estimate for earnings for the quarter was $13.24 billion, but the Walt Disney Company missed expectations with earnings of $13.10 billion. This led to sharp declines in the stock price, but several measures have been implemented to boost investor sentiment. Year-on-year, the quarterly earnings increased by 5.1 percentage points, and economic analysts are of the opinion that the company will post earnings per share of $5.08 per 2015. For these reasons, traders will be well-poised to place call options on the stock.

What are Analysts Saying about Walt Disney Stock?

On a scale of 1.0 – 5.0, where 1.0 represents a strong buy and 5.0 represents a sell, Disney is currently at 2.2. This is unmoved from last week. Put in perspective, it represents the general consensus that Disney stock is indeed on a bullish uptrend. The mean target price for the stock is $118.57 with a high of $148 and a low of $89. Viewed in perspective, it is clear that Disney stock is perhaps slightly undervalued, with upside potential. However, the year has been peppered with multiple upgrades and downgrades, including the following: