Sign InDisney stock analysis: Hold position as stock faces downward pressure and organizational challenges
Summary
As of the analysis on June 30, 2023, The Walt Disney Company's stock showed a slight increase and is currently in the neutral territory, but there are some downward pressures and potential undervaluation, so the advice would be to 'Hold' and monitor future developments closely before considering a 'Buy.'
Company Overview
The subject of this analysis is The Walt Disney Company (NYSE: DIS). They closed their last trading session on June 30, 2023, at $89.28, signifying an increase of 0.37% or $0.33 from the prior day. The stock oscillated between an intraday low of $88.61 and a high of $89.60. For the year, the stock has measured a high and low of $126.48 and $84.07, respectively.
As of the last report, The Walt Disney Company had a market capitalization of about $163.14 billion. The daily traded volume trailed to 10.43 million shares, which was under the average volume level of 12.42 million shares. There are currently 1.83 billion Disney shares outstanding.
Technical Analysis
Reviewing the indicators, the 14-Day Relative Strength Index (RSI) for Disney is at 37, which maybe indicate the stock is in the 'neutral' territory.
However, when examining the 50 and 200-day moving averages, the stock seems to have some downward pressure. It is currently trading below both these averages, priced at $93.67 and $97.56, respectively. The recent Moving Average Convergence Divergence (MACD) over a 3-month period also stands at 0.45.
Fundamental Analysis
Disney's earnings are evaluated at $2.25 per share, producing a Price to Earnings (PE) ratio of 39.68.
The Discounted Cash Flow (DCF) analysis, a valuation method utilized to estimate the attractiveness of an investment opportunity, offers an estimated stock value of $95.64. It is worthwhile to note that this is higher than the current stock price, hinting at some undervaluation.
Analysts' Opinion and Future Target
Presently, analysts seem to have a diverging opinion on Disney stock. The lowest target price is set at $105, the highest at a substantial $263. The consensus target came out at around $159.07, with the median target at $151.
Recent News Impact
Relevant news about Disney may be influencing its stock price. A conspicuous piece of news is about the KeyBanc downgrade. However, despite the downgrade, some analysts see a promising opportunity in Disney stock. With recent layoffs at ESPN and potential issues with the company's so-called "lifeblood", predictions for the next trading day or the upcoming week might be cautiously bearish, with the possibility to hover around the same level or even a slight decrease due to investor concerns.
Buy, Hold or Sell
Based on the overall assessment, the advice would lean towards a 'Hold.' While the DCF and light recent volume might suggest potential undervaluation, the underperformance relative to its 50 and 200-day moving averages combined with recent news about organizational challenges should be a cause for investor caution. While not a 'Sell' at this point, investors should monitor future developments closely before considering a 'Buy.'
