In the consumer discretionary industry, players either evolve or get streamed over. Disney (DIS), the century-old king of castles, cartoons, and cinematic blockbusters, seems to have traded in its glass slipper for a sharper, profit-driven playbook. Earlier this spring, inflation pressures and tariff concerns dragged Disney stock to a 52-week low of $80.10. But Disney pulled a plot twist worthy of its own writers’ room — rallying more than 31% in just three months. That comeback didn’t happen by accident.
As wallets tightened and splurges were shelved, streaming stayed sacred. That stickiness has become a lifeline, and Disney has smartly leaned in where the audience refuses to log out. While Disney+ and its broader digital portfolio account for only about a quarter of total revenue, it has finally entered profitability territory. Subscriber growth may slow with recent price hikes, but the company is clearly prioritizing quality over quantity, and margin over metrics.
Now all eyes are on Wednesday, Aug. 6, when the curtain is set to rise on Disney’s third-quarter earnings. Analysts expect a $1.47 per-share profit on $23.76 billion in revenue. The report will offer a telling look at how far Disney’s transformation has flown, and whether there’s still enough pixie dust left to keep the magic alive.
About Disney Stock
Headquartered in Burbank, California, Disney has grown into a global entertainment empire, mastering the art of storytelling and monetizing it across movies, parks, merch, and now streaming. Taking on Netflix (NFLX) and Amazon's (AMZN) Prime Video, Disney’s digital game is heating up. With a $215 billion market capitalization, it’s not just making memories — it's shaping the future of entertainment.
Disney’s chart reads like a comeback script. After bottoming out at $80.10 in April, DIS stock flipped the script and hit $124.69 on June 30. The rally was powered by May’s strong earnings report and a broader rebound in risk appetite, with analyst buzz around streaming profits and margin gains adding fuel to the fire. Shares are now up roughly 50% from the April low, marking several new highs in just three months, suggesting momentum has been strong.
That momentum, however, has cooled a bit, with DIS stock now consolidating near $120 and sitting below key resistance at $123 — a level where sellers previously stepped in. The RSI sits at a neutral 51.47, suggesting room to move in either direction, while steady volume and price action above key moving averages keep bulls optimistic. Traders are now eyeing a breakout above the 13-week high. With earnings set for next week, the next scene could either power the rally forward or cue a pullback.
After a three-year pause, Disney brought its dividend magic back last year, starting at $0.30 in January 2024 and lifting the payout to $0.50 per share by July 23, 2025, now yielding 0.83%.
With a modest 16% payout ratio, the company is signaling strength while keeping cash on deck for future moves. That balance of reward and reinvestment is not going unnoticed.
On the valuation front, DIS stock trades at 21 times forward earnings and 2.37 times sales. That's still a discount compared to rivals like Netflix and below its own historical norms.
A Closer Look at Disney’s Q2 Report
Disney’s momentum is picking up steam under CEO Bob Iger’s second act. Since returning as CEO, Iger’s strategy reboot is showing results — stronger fundamentals, sharper execution, and a tighter focus on profitability.
That progress came into focus after the company unveiled its Q2 earnings report on May 7. The company generated revenue of $23.6 billion, up 7% year-over-year (YOY) and exceeding forecasts. The real mic drop was streaming. While rivals still bleed red, Disney+ and Hulu posted a combined profit of $336 million, a stellar jump from last year’s $47 million. Meanwhile, adjusted EPS climbed by 20% annually to $1.45, coming in well above expectations thanks to streaming momentum, packed domestic parks, and Moana 2's home-entertainment firepower. Subscriber count for Disney+ inched up to 126 million.
Meanwhile, free cash flow more than doubled to $4.9 billion, and operating cash hit $6.8 billion. Liquidity remained solid with nearly $5.9 billion in cash in hand, underscoring the improved financial resilience of the business.
Looking ahead, Disney is not just hoping for a comeback — it is planning one with precision. The company expects adjusted EPS for fiscal 2025 to hit $5.75, marking a solid 16% annual jump. Management is also calling for double-digit operating income growth in its entertainment and sports arms, a clear sign the turnaround is gaining ground. Even its theme parks and consumer products — the legacy engines — are expected to deliver 6% to 8% growth. When earnings hit next Wednesday, Disney+ is also set for modest subscriber gains in Q3, keeping the direct-to-consumer engine humming as Iger’s vision continues to unfold.
Analysts tracking Disney expect the company’s Q3 EPS to surge by 5.8% YOY. Looking further ahead, the company is projected to report a profit of $5.78 per share in fiscal 2025, up 16.3% YOY, with further annual growth of 9.9% to $6.35 per share expected in fiscal 2026.
What Do Analysts Expect for Disney Stock?
Wall Street is looking at Disney with a fresh pair of Mickey ears. Recently, UBS raised DIS stock's price target to $138 from $120 while sticking to a “Buy” rating. The firm anticipates strong Q3 tailwinds ahead, pointing to unwavering demand at the parks and a bounce in direct-to-consumer profitability. That combination, they believe, could help Disney keep the earnings growth story alive.
Adding to the optimism, JPMorgan also lifted its target to $138 from $130, maintaining an “Overweight” rating. With Q3 results approaching, the firm highlights that investors are focused on operating income gains driven by both volume and pricing in Disney’s direct-to-consumer segment. Theme parks remain a bright spot, and JPMorgan's updated estimates reflect confidence that Disney’s key growth engines are gaining momentum.
That upbeat tone is not just limited to a few firms. Disney carries a consensus “Strong Buy” rating overall. Of the 28 analysts covering the stock, 21 advise a “Strong Buy,” two recommend a “Moderate Buy,” and the remaining five analysts suggest a “Hold.”
The average analyst price target of $132.32 indicates potential upside of 11% from current price levels. Meanwhile, the Street-high target of $148 suggests that DIS stock can rise by as much as 24% from here.
