Disney stock price forecast after the strong quarterly results

The Disney (NYSE: DIS) stock price jumped by more than 5% in extended hours after the company published strong quarterly results. The shares rose to $189 after it closed at $179, bringing its total market capitalization to more than $325 billion.

Disney strong earnings

Walt Disney had a strong quarter, helped by its parks business. The company’s revenue jumped by 44% year on year to $17.02 billion. This was $260 million higher than what analysts were expecting. As a result, the company’s earnings-per-share rose to $0.80, which was also about $0.25 higher than estimates.

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The company’s direct-to-consumer business continued its growth path. Disney+, Hulu, and ESPN+ ended the quarter with 116 million, 14.9 million, and 42.8 million customers, respectively. This brings the total number of subscribers to more than 174 million, which is still lower than the number of Netflix customers. 

By segments, DPEP revenue rose by $2.2 billion as more countries reopened, leading to more demand for the company’s parks and resorts. Further, its media and entertainment distribution declined by about $1 billion. 

The firm attributed this trend to the strong uptake of its direct to consumer products. This was partially offset by the fact that domestic advertisers increased their advertising budgets as the economy reopened.  Meanwhile, its direct to consumer business revenue rose by more than $300 million. This growth was partially offset by losses at Disney+

The Disney stock price also rose because of the boosted forward guidance. The firm expects that its capital expenditure will be lower by about $200 million.

So, is the Disney stock a buy or sell? Analysts are generally positive about Disney as the economy reopens. Analysts at Wolfe Research expect that it will rise to $226 while those at Deutsche Bank, Truist, and Royal Bank of Canada expect that it will rise to more than $200.

Disney stock price forecast

The 4H chart shows that the Disney stock price popped in the extended hours. By doing so, the shares rose to the highest level since May 3. As a result, the shares rose above the 25-day and 50-day moving averages (MA) while the Relative Strength Index (RSI) rose to 76. The shares also rose above the key resistance level at $186, which was the highest level since July 13. 

Therefore, in the long-term, the stock will likely keep the upward momentum rising. However, for today, the shares will likely retreat during the regular session.

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