Warner Bros. Discovery (WBD) has taken significant steps to transform its streaming service, Max, into a more desirable platform. Recognizing the service’s previous shortcomings, the company has revamped its content offerings. The updated strategy involves phasing out children’s programming and unscripted shows in favor of more targeted adult-oriented content and true-crime series. This move aims to create a distinct appeal among its audience.

Crucially, a collaboration with Disney (DIS, Financial) has played a pivotal role in driving subscriber growth for Max. This partnership not only boosted the number of subscribers domestically but also holds promise for future international expansion.

The revamped efforts bore fruit in 2024, as Max successfully added 20 million new subscribers, bringing its total subscriber base to 117 million worldwide by the end of the year. Warner Bros. Discovery has set a target to expand this figure to 150 million subscribers by 2026, reflecting its commitment to further cementing Max’s position in the competitive streaming industry.

Wall Street Analysts Forecast

Based on the one-year price targets offered by 27 analysts, the average target price for The Walt Disney Co (DIS, Financial) is $123.90 with a high estimate of $147.00 and a low estimate of $79.00. The average target implies an
upside of 41.94%
from the current price of $87.29. More detailed estimate data can be found on the The Walt Disney Co (DIS) Forecast page.

Based on the consensus recommendation from 32 brokerage firms, The Walt Disney Co’s (DIS, Financial) average brokerage recommendation is currently 2.0, indicating “Outperform” status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.

Based on GuruFocus estimates, the estimated GF Value for The Walt Disney Co (DIS, Financial) in one year is $115.46, suggesting a
upside
of 32.27% from the current price of $87.29. GF Value is GuruFocus’ estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business’ performance. More detailed data can be found on the The Walt Disney Co (DIS) Summary page.

DIS Key Business Developments

Release Date: February 05, 2025

• Film Studio Performance: Top three movies of 2024 at the global box office.
• Streaming Profitability: Growth in streaming profitability.
• ESPN Ratings: Historic ratings achieved.
• Experiences Business: Strong and enduring appeal noted.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• The Walt Disney Co (DIS, Financial) achieved strong performance in its film studios, with the top three movies of 2024 at the global box office.
• Growth in streaming profitability was observed, with significant advancements in technology and personalization efforts.
• ESPN experienced historic ratings, contributing positively to the company’s financial results.
• The Experiences business showed strong and enduring appeal, with positive bookings and successful launches like the Disney Treasure.
• The company demonstrated effective cost management and maintained confidence in its financial guidance despite macroeconomic uncertainties.

Negative Points

• The company faces challenges with cord-cutting trends and the need to adapt to skinnier bundles in the market.
• There is ongoing pressure to enhance the Disney+ platform to reduce churn and increase subscriber growth.
• The NBA contract presents a challenge with increased rights costs, requiring strategic management to maintain profitability.
• The company is navigating a rapidly evolving macro environment, which could impact financial performance and guidance.
• Technological advancements and platform enhancements are still in progress, requiring continued investment and development.