Disney (ticker: DIS) rose 8.2% in premarket trading to $121.70.
Analysts at Guggenheim, led by Michael Morris, upgraded Disney to Buy from Neutral and lifted their price target to $145 from $110, saying this was “reflecting our higher estimates and our greater confidence in the sustainability of Parks trends and effectiveness of price increases and cost controls at the company’s direct-to-consumer segment.”
Disney’s direct-to-consumer (DTC) arm, which includes its overseas media business and streaming services, is one of the company’s key divisions.
Analysts at KeyBanc Capital Markets, led by Brandon Nispel, raised their price target to $154 from $131 saying: “We continue to see DIS as the only asset we want to own in Media.”
They also cited its platform of products at its DTC arm and like its “relatively strong” linear brands, and ability to tie content and experiences together with the theme park business, which they say “should result in revenue and OI [operating income] growth that is among the fastest in our coverage for the next several years.”
While the company gave details of plans to hike the price of its Disney+ streaming service at the end of the year, and an advertising-supported option, it did scale down its outlook for future subscriber numbers to a top-end estimate of 245 million subscribers from a top end of 260 million.