Disney (NYSE: DIS) is the world's second largest media conglomerate.
In general, analysts see adequate revenue gains on media network performance (including solid TV advertising sales), and relatively heavy traffic at worldwide theme parks.
Meanwhile, merchandise licensing revenue should be adequate, as should film revenue, with difficult year-to-year film revenue comparisons expected to lighten somewhat in F2009. Further, Disney's balance sheet is among the strongest in the sector. The Reuters F2008/F2009 EPS consensus estimates for DIS are $2.23/$2.39.
The risks? A U.S. economic recession and concomitant pull-back in consumer discretionary spending would (obviously) hurt Disney's results. A major appreciation in the dollar would also lower U.S. theme park attendance by foreign visitors, but don't look for that to occur in 2008.
The First Call mean rating for DIS is: Buy [29 firms]. Mean 2008 target: $38 [high: $44, low: $27].
Stock Analysis: Disney is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than two years should be rewarded from DIS shares. Sell / Stop Loss: $18.
Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.
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