- Disney reported a 39% raise in adjusted EPS in its fiscal fourth quarter.
- Strong and robust results helped Disney’s stock rise 10%.
- The Dow remains subdued on Thursday as markets move sideways.
- It is expected that the years 2025 and 2026 will bring double-digit dynamics of profit growth.
The Disney Company (DIS) may finally be out of trouble after rising 10% on Thursday following solid fiscal fourth-quarter financial results. However, several high-profile hedge funds missed the mark by selling their Disney holdings in the third quarter.
Disney beat earnings and earnings rather slightly, but the market was delighted with the media conglomerate’s fiscal 2025 earnings per share (EPS) forecast raise. Instead of the 4% year-over-year adjusted earnings per share (EPS) growth forecast for 2025, management said that it now expects “high single-digit results.”
The Dow Jones Industrial Average (DJIA)including Disney, were trading slightly higher at the time of writing, while the NASDAQ and S&P 500 indexes were moving lower.
Disney stock performance news
Disney earned $1.14 in adjusted EPS in its fiscal fourth quarter, which ended Sept. 28. This was 3 cents better than the Wall Street consensus and up 39% year over year. Revenue was $80 million above the consensus estimate of $22.57 billion, up 6% from the same quarter a year ago.
Disney’s results in the fourth quarter are primarily due to the Entertainment segment, which recorded a revenue raise of 14% y/y. However, revenues from sports remained unchanged, and revenues from attractions increased only by 1% y/y.
Of the $3.66 billion in total operating income for the quarter, Entertainment earned $1.07 billion, triple the year-ago figure, while Sports earned $929 million and Experiences earned $1.66 billion.
In 2025, Disney expects $15 billion in cash from operations. $8 billion was spent on capital investments and $3 billion on share buybacks. Management said it expects the dividend to follow its earnings growth path.
Additionally, management said it forecast double-digit adjusted EPS growth in both 2026 and 2027.
Too bad for investors in Nelson Peltz’s Trian Fund Management. Peltz lost a costly proxy battle with Disney earlier this year and gave up his entire position in the company in the third quarter, according to his hedge fund’s 13F filing this week. Additionally, mega hedge fund Bridgewater Associates also exited its enormous position in Disney this quarter.
Disney Stock Chart
Disney shares have shot above the $107.43 price level, which has been an vital support and resistance level since February. The price level may now become support at this point, although bulls will focus on the long-term significance of the $118 level, as well as the $123.50 level that interrupted the rally earlier this year.
A good sign is that the 50-day basic moving average (SMA) has broken above its 100-day counterpart. This means that the days of the bearish downtrend that began in July when the 200-day SMA moved above the 50-day SMA may be coming to an end.
Disney stock was quite overbought on Thursday, with its Relative Strength Index (RSI) hitting 85, well above the 70 mark. With many traders taking profits on Thursday morning, investors will be looking for a place where the stock price settles before it hits an intraday high of $114.81.
DIS stock daily chart
