Back to top

Image: Bigstock

The Zacks Analyst Blog Highlights: Disney, Netflix, Comcast and AT&T

Read MoreHide Full Article

For Immediate Release

Chicago, IL – February 4, 2020 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Disney DIS, Netflix NFLX, Comcast (CMCSA - Free Report) and AT&T T.

Here are highlights from Monday’s Analyst Blog:

Will Disney+ Take DIS “To Infinity – And Beyond”?

Disney is up to bat this earnings season, and this quarterly report is crucial to how investors perceive this evolving tech firm moving forward. It will be the first earning report that will include Disney+. The entertainment conglomerates esteemed streaming platform.

Disney reported excellent traction in the first 24 hours of its release, with 10 million new subscribers right off the bat. Whether the platform was able to maintain its prolific user growth will be illuminated in DIS's earnings release on Tuesday, January 4th, after the bell.

Bernie McTernan, an analyst from Rosenblatt Securities, is estimated that Disney’s new streaming service had 25 million subscribers rounding out 2019. This would represent a substantially higher signup rate than what was initially anticipated. Analysts are estimating that Disney has already pouched more than 1 million subscribers from Netflix. Disney+ is undoubtedly shaking up the streaming space.

Disney is not alone, Comcast is releasing their new streaming platform, Peacock, on April 15th and AT&T is releasing HBO Max the following month. There is room for more than one platform to thrive in this space. Price point and content quantity & quality will be the deciding factors that dictate whether these services thrive or dive.

Disney+ is this company’s shiny new product offering, which is expected to be a significant profit driver for the company moving forward. Though, there is still quite a bit of uncertainty regarding this service’s timeline to profitability. Disney is undercutting its cohorts, offering its platform for only $6.99 a month, which will allow the company to attract a broader demographic. This seemingly discounted price is exactly that. Disney is offering this low rate to initially attract customers but will increase this as its reach expands, and its library of quality original content continues to develop, something that Netflix has been doing for years.

What To Expect On From The Report

Disney is typically not a huge mover on earnings releases, but its September quarter results excited investors with the anticipation of Disney+, pushing the share price up 5% following the report. According to Zacks Consensus estimates, Disney is expected to report a record $21.08 billion in sales and an EPS of $1.43. This would represent sales growth of 38%, but an EPS decline of 22% due to integration costs of recently acquired 21st Century Fox, as well as costs associated with the launch of Disney+.

DIS has trended marginal down following the initial hype surrounding Disney+, which launched the share price up over 15% in 14 trading days ending on November 26th. The stock has since broken down almost 9%.

This downward price move may have created a springboard for this stock to jump off in the upcoming earnings. Disney+ will be the most important topic to focus on while reading the report or listening to the earnings call. The exciting subscription expectations that Bernie McTernan is estimating gives me optimism about how much Disney+ could have topped analyst’s expectations.

Any realized synergies with 21st Century Fox could boost the stock while any unexpected additional integration costs could put downward pressure on the stock.

Take Away

Disney’s new streaming service is the first step in the evolution of this media & entertainment conglomerate into a fast growing tech company. Disney+ is changing the streaming game for binge watchers around the world as well as DIS shareholders. Management guidance and forward sentiment will be crucial to how this stock reacts following this report.

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339                                                                            

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Comcast Corporation (CMCSA) - free report >>