Disney reports Q2 earnings amid a severe stock rout – Stock Markets
Walt Disney unveils earnings before market’s opening bell on August 7
Solid revenue and profit growth is expected despite recent stock selloff
Valuation is currently at its lowest levels since the Covid-19 outbreak
Flat in the year despite an impressive start
Although the year started with the best auspicious signs for Disney, which were also reinforced by a very strong Q1 earnings report, things turned ugly very quickly. Increasing concerns over the firm’s advertising business growth coupled with a series of disappointing movie productions have triggered a steep selloff in the firm’s stock. In actual numbers, markets are projecting a whopping 66% year-on-year decrease in Disney’s advertising revenue for the second quarter.
![](https://www.xm.com/wp-content/uploads/2024/07/Disney-Perf.png)
In April, Disney’s stock was more than 35% higher compared to the start of the year, largely outperforming major US benchmarks. However, the combined pessimism has led to the stock erasing all of its 2024 gains, trading essentially flat in the year ahead of its Q2 earnings. On the bright side though, the firm’s theme parks appear to be able to shoulder the burden so far, with Disney’s traditional business expected to grow 6.5% on an annual basis.
Not great, not terrible
The entertainment powerhouse is set to have a robust quarter even though the advertising segment is forecast to receive a heavy blow. Specifically, Disney is anticipated to post revenue of $23.04 billion for the second quarter, according to consensus estimates by LSEG IBES, which would represent a year-on-year increase of 3.2%. Moreover, earnings per share (EPS) are projected at $1.19, marking a 15.62% jump on an annual basis.
Valuation reflects pessimism
Disney has been facing a slowdown in its streaming segment, while its latest movies have not been a success either. Given that its growth segments are clearly lagging its core business, which includes its theme parks and their attractions across the globe, investors have started to adjust the firm’s valuation to lower levels.
![](https://www.xm.com/wp-content/uploads/2024/07/Disney-Valuation.png)
Disney has been trading with a considerable discount against the S&P 500, at its lowest multiples since the pandemic outbreak shut down its on-site operations. Specifically, the 12-month forward price-to-earnings ratio, which denotes the dollar amount someone would need to invest to receive back one dollar in annual earnings, currently stands at 17.5x versus the S&P 500’s multiple of 20.8x.
Stock posts death cross ahead of earnings
From a technical perspective, Disney’s stock has been in a steady decline since its 2024 peak in April, finding support near its January 2024 lows around $89.00. Meanwhile, the 200-day simple moving average (SMA) completed a death cross with the 50-day SMA for the first time since January 2024, further darkening the technical picture.
![](https://www.xm.com/wp-content/uploads/2024/07/Disney-TA.png)
If earnings disappoint, the stock could find support at the recent six-month low of $89.20. Lower, the December 2022 bottom of $84.00 may provide downside protection.
Alternatively, should Disney beat estimates, the stock price may advance towards the November 2023 peak of $96.50. A violation of that zone could pave the way for $99.30, which is the lower end of a positive price gap registered in February.
관련 자산
최신 뉴스
면책조항: XM Group 회사는 체결 전용 서비스와 온라인 거래 플랫폼에 대한 접근을 제공하여, 개인이 웹사이트에서 또는 웹사이트를 통해 이용 가능한 콘텐츠를 보거나 사용할 수 있도록 허용합니다. 이에 대해 변경하거나 확장할 의도는 없습니다. 이러한 접근 및 사용에는 다음 사항이 항상 적용됩니다: (i) 이용 약관, (ii) 위험 경고, (iii) 완전 면책조항. 따라서, 이러한 콘텐츠는 일반적인 정보에 불과합니다. 특히, 온라인 거래 플랫폼의 콘텐츠는 금융 시장에서의 거래에 대한 권유나 제안이 아닙니다. 금융 시장에서의 거래는 자본에 상당한 위험을 수반합니다.
온라인 거래 플랫폼에 공개된 모든 자료는 교육/정보 목적으로만 제공되며, 금융, 투자세 또는 거래 조언 및 권고, 거래 가격 기록, 금융 상품 또는 원치 않는 금융 프로모션의 거래 제안 또는 권유를 포함하지 않으며, 포함해서도 안됩니다.
이 웹사이트에 포함된 모든 의견, 뉴스, 리서치, 분석, 가격, 기타 정보 또는 제3자 사이트에 대한 링크와 같이 XM이 준비하는 콘텐츠 뿐만 아니라, 제3자 콘텐츠는 일반 시장 논평으로서 "현재" 기준으로 제공되며, 투자 조언으로 여겨지지 않습니다. 모든 콘텐츠가 투자 리서치로 해석되는 경우, 투자 리서치의 독립성을 촉진하기 위해 고안된 법적 요건에 따라 콘텐츠가 의도되지 않았으며, 준비되지 않았다는 점을 인지하고 동의해야 합니다. 따라서, 관련 법률 및 규정에 따른 마케팅 커뮤니케이션이라고 간주됩니다. 여기에서 접근할 수 있는 앞서 언급한 정보에 대한 비독립 투자 리서치 및 위험 경고 알림을 읽고, 이해하시기 바랍니다.