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Walt Disney Stock Evaluation Essay

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Walt Disney Stock Evaluation Essay
Stock Evaluation of The Walt Disney Company (DIS)
As of March 1st, 2017

Prepared for:
BUS-495-01
University of San Francisco.

Prepared by:
Qi Heng (Eric) Wang
University of San Francisco
Company Overview:

“The Walt Disney Company” is an international leader owning major brands in entertainment, content creation, and recreation. Founded on 1923 by Walt Disney and Roy O. Disney, the company soon became a leader in the animation industry with iconic characters such as Mickey Mouse. The company has since expanded beyond pure studio animation and into television, music, publishing, digital media, live action films theme parks and more. Their diversified business segments includes their media distribution networks, parks and …show more content…
With the successful launch of the Shanghai Disneyland in 2016, the company continue to increase its international influence. In addition, recent success at the box office with Disney’s Oscar Winning “Zootopia” and upcoming releases from LucasFilms displays the company’s potential to grow.
However, Disney’s primary source of revenue comes from their media distribution channels. Disney owns ABC, ESPN, Disney Channel, and other popular networks making up over 40% of their revenue income (23.69 billion in 2016). According to Disney’s Q4 report for 2016, revenues fell by 2.7 % and based on Disney’s growing concerns for ESPN, subscriptions have since decreased by 10 million since its peak in 2013 of 99 million. At the moment, potential loss mostly will be offset by revenue increases from Disney Parks and upcoming movie releases from LucasFilm and Marvel. However it will be unlikely that Disney will break it’s all-time high of $122.08 from August 2014 in the upcoming year.

Disney is currently trading at $111.04 (3/1/17), within our expected trading range but, nonetheless overvalued. Disney stock is currently trading at a premium, a common occurrence for companies with strong
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