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Disney (DIS) to Report Q1 Earnings: What's in the Cards?
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Disney (DIS - Free Report) is set to report first-quarter fiscal 2020 results on Feb 4.
The Zacks Consensus Estimate for earnings has declined 3.4% to $1.43 per share over the past 30 days. The figure indicates a decline of 22.3% from the year-ago quarter’s reported figure.
The consensus mark for revenues is pegged at $21.08 billion, implying growth of 37.7% from the year-ago period’s reported figure.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 2%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Disney’s first-quarter fiscal 2020 top line is expected to have benefited from strong box-office collections of Frozen 2 and Star Wars: Rise of Skywalker.
Frozen 2 lived up to expectations as the animated movie broke the box-office collection record following its release on Nov 22, 2019. In the opening weekend, the sequel to 2013’s Frozen collected $358.4 million — the “biggest global animated debut of all time.”
Further, per Disney, Frozen 2 collected $53 million in China, where it had the third-highest opening weekend ever for an animated title.
Frozen 2 has raked in roughly $1.50 billion to date, per data from Box Office Mojo, and has surpassed the first Frozen’s collection of $1.28 billion globally.
Moreover, although critics panned Star Wars: Rise of Skywalker (released on Dec 18, 2019), it turned out to be one of the most lucrative movies in terms of box-office collection, particularly in the domestic market.
To date, Star Wars: Rise of Skywalker has raked in roughly $1.05 billion, per data from Box Office Mojo.
The Zacks Consensus Estimate for Studio Entertainment revenues is currently pegged at $3.68 billion, suggesting a surge of 101.8% from the figure reported in the year-ago quarter and 11.2% sequentially.
However, Disney expects 21CF film studio to report an operating loss of roughly $60 million.
The consensus mark for Studio Entertainment operating income is currently pegged at $867 million, suggesting a surge of 180.6% from the figure reported in the year-ago quarter but a decline of 19.6% sequentially.
Additionally, the company projects the 21CF acquisition and the impact of taking full operational control of Hulu to hurt fiscal first-quarter earnings before purchase accounting by 30 cents per share.
Moreover, Disney’s profitability in the quarter to be reported is likely to reflect ongoing investments in direct-to-consumer (DTC) businesses that now include Hulu, ESPN+ and Disney+ streaming service.
Disney expects continued investment in these services to hurt the DTC & International segment’s operating income. The Zacks Consensus Estimate for DTC & International/Consumer Products operating income is currently pegged at a loss of $763 million compared with a loss of $740 million reported in the previous quarter.
Notably, Disney launched Disney+ in the United States, Canada and The Netherlands on Nov 12. The service is priced competitively compared with both Netflix (NFLX - Free Report) and Apple TV+, which Apple (AAPL - Free Report) launched on Nov 1.
Disney+ costs $6.99 per month. The company is also offering a bundle package of Disney+, ESPN+ and ad-supported Hulu for $12.99 a month.
Per Sensor Tower data, cited by TechCrunch, the streaming service’s mobile app has been downloaded more than 30 million times in fourth-quarter 2019. The company itself announced 10 million Disney+ sign-ups a day after its debut.
Additionally, Disney+’s 30 million U.S. installs were more than what Hulu and Amazon (AMZN - Free Report) prime video had witnessed in 2019.
The Zacks Consensus Estimate for DTC & International/Consumer Products revenues is currently pegged at $4.05 billion, indicating growth of 18.1% from the figure reported in the previous quarter.
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Disney (DIS) to Report Q1 Earnings: What's in the Cards?
Disney (DIS - Free Report) is set to report first-quarter fiscal 2020 results on Feb 4.
The Zacks Consensus Estimate for earnings has declined 3.4% to $1.43 per share over the past 30 days. The figure indicates a decline of 22.3% from the year-ago quarter’s reported figure.
The consensus mark for revenues is pegged at $21.08 billion, implying growth of 37.7% from the year-ago period’s reported figure.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 2%.
The Walt Disney Company Price and EPS Surprise
The Walt Disney Company price-eps-surprise | The Walt Disney Company Quote
Let’s see how things are shaping up for this announcement.
Factors to Consider
Disney’s first-quarter fiscal 2020 top line is expected to have benefited from strong box-office collections of Frozen 2 and Star Wars: Rise of Skywalker.
Frozen 2 lived up to expectations as the animated movie broke the box-office collection record following its release on Nov 22, 2019. In the opening weekend, the sequel to 2013’s Frozen collected $358.4 million — the “biggest global animated debut of all time.”
Further, per Disney, Frozen 2 collected $53 million in China, where it had the third-highest opening weekend ever for an animated title.
Frozen 2 has raked in roughly $1.50 billion to date, per data from Box Office Mojo, and has surpassed the first Frozen’s collection of $1.28 billion globally.
Moreover, although critics panned Star Wars: Rise of Skywalker (released on Dec 18, 2019), it turned out to be one of the most lucrative movies in terms of box-office collection, particularly in the domestic market.
To date, Star Wars: Rise of Skywalker has raked in roughly $1.05 billion, per data from Box Office Mojo.
The Zacks Consensus Estimate for Studio Entertainment revenues is currently pegged at $3.68 billion, suggesting a surge of 101.8% from the figure reported in the year-ago quarter and 11.2% sequentially.
However, Disney expects 21CF film studio to report an operating loss of roughly $60 million.
The consensus mark for Studio Entertainment operating income is currently pegged at $867 million, suggesting a surge of 180.6% from the figure reported in the year-ago quarter but a decline of 19.6% sequentially.
Additionally, the company projects the 21CF acquisition and the impact of taking full operational control of Hulu to hurt fiscal first-quarter earnings before purchase accounting by 30 cents per share.
Moreover, Disney’s profitability in the quarter to be reported is likely to reflect ongoing investments in direct-to-consumer (DTC) businesses that now include Hulu, ESPN+ and Disney+ streaming service.
Disney expects continued investment in these services to hurt the DTC & International segment’s operating income. The Zacks Consensus Estimate for DTC & International/Consumer Products operating income is currently pegged at a loss of $763 million compared with a loss of $740 million reported in the previous quarter.
Notably, Disney launched Disney+ in the United States, Canada and The Netherlands on Nov 12. The service is priced competitively compared with both Netflix (NFLX - Free Report) and Apple TV+, which Apple (AAPL - Free Report) launched on Nov 1.
Disney+ costs $6.99 per month. The company is also offering a bundle package of Disney+, ESPN+ and ad-supported Hulu for $12.99 a month.
Per Sensor Tower data, cited by TechCrunch, the streaming service’s mobile app has been downloaded more than 30 million times in fourth-quarter 2019. The company itself announced 10 million Disney+ sign-ups a day after its debut.
Additionally, Disney+’s 30 million U.S. installs were more than what Hulu and Amazon (AMZN - Free Report) prime video had witnessed in 2019.
The Zacks Consensus Estimate for DTC & International/Consumer Products revenues is currently pegged at $4.05 billion, indicating growth of 18.1% from the figure reported in the previous quarter.
Zacks Rank
Disney currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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