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Is Disney (DIS) a Buy Heading into Q3 Earnings Announcement?
Media conglomerate Disney (DIS - Free Report) is set to report fiscal Q3 results Wednesday after the closing bell. Disney, a Zacks Rank #3 (Hold), has missed earnings estimates in two of the past three quarters. With analyst estimates coming down recently, is this market leader a buy heading into the earnings announcement?
Shares of DIS have fallen about 30% since the beginning of the year. Analysts are expecting the company to post quarterly EPS of $0.94 per share, which would translate to growth of 17.5% versus the same quarter last year. Disney boasts a trailing four-quarter average earnings surprise of 22.2%. Analyst estimates have declined -13% in the past 60 days.
DIS is part of the Zacks Media Conglomerates industry, which ranks in the top 19% out of approximately 250 industry groups. Yet the entertainment giant is still overvalued relative to its industry group. More weakness may lie ahead if the company fails to impress on its quarterly results.