Disney Stock Up 23% Since October, Guggenheim Securities Upgrades Stock

Walt Disney Company (DIS) stock rose 7% in the last 3 months and over 23% since October 2016 lows. The company’s bleak forecast for ESPN, a subsidiary that lost over 600,000 subscribers between October and November 2016, is a problem for the media giant and for DIsney Stock

Disney Stock

ESPN subscriber numbers are down over 9 million since 2013 when subscriber numbers hit 99 million.

ESPN, ABC and Disney Channel, along with several other channels in the company’s media network, bring in over $23 billion in income for the company per year. The loss of subscribers in late 2016 account for a $52 million drop in revenue for Disney’s ESPN channel.

The sports channel paid a reported $7.3 billion in rights fees for 2017 despite a loss of over 4 million subscribers in 2016.

Disney’s stock plummet in October is a direct result of the struggling sports network. The company’s strong movie portfolio and theme park performance led to the rally into 2017. The company’s stock gained further support on Tuesday as Michael Morris, an analyst from Guggenheim Securities, upgraded his rating of the company to a “buy.”

Morris increased the 12-month price for Disney stock to $128. Disney stock is trading at $112.25 on Wednesday.

Blockbuster Films

 

The company’s pipeline of blockbuster films include Beauty and the Beast, which opens this weekend. The company also produces films under the Pixar, Marvel, Disney and Star Wars names.

Disney is slated to release a sequel to blockbuster Frozen, another Indiana Jones film and another iteration of Toy Story next year. The company’s theme parks will get a boost from the opening of Star Wars Lands in California, which is expected to support the company’s growth.

The company’s eighth installment of Star Wars is slated for release in December. The 2015 Star Wars Ep. VII: The Force Awakens is the third-highest grossing film of all-time, earning $2.07 billion worldwide.

Disney’s ESPN has secured deals with DirecTV Now and Sling TV to carry ESPN on their digital TV services.