Benchmark initiates Walt Disney stock coverage with buy rating

Benchmark initiates Walt Disney stock coverage with buy rating

Gold slides as U.S.-Iran conflict lifts oil, hawkish Fed bets grow Investing.com - Benchmark initiated coverage on Walt Disney Co. (NYSE:DIS) with a buy rating and set a price target of $115, the firm said Monday. This target aligns closely with InvestingPro’s Fair Value analysis, which suggests Disney appears undervalued at its current price of $95.62—near its 52-week low. The stock trades at a P/E ratio of 15.4 with a notably low PEG ratio of 0.53, indicating attractive value relative to growth prospects.

The firm applied a 17x multiple to its fiscal 2026 adjusted earnings per share estimate to arrive at the price target. Benchmark views Disney as one of the world’s most powerful consumer engagement platforms with globally recognized intellectual property that can be monetized across streaming, sports, parks, cruises, consumer products, gaming, advertising and theatrical releases. The firm’s thesis centers on three points, with the Experiences segment becoming Disney’s earnings foundation.

The division generates roughly 57% of segment operating income despite representing less than 40% of revenue, according to Benchmark. InvestingPro assigns Disney a "Good" financial health score, and investors seeking deeper analysis can access one of over 1,400 comprehensive Pro Research Reports available for US equities. Parks, cruises and consumer products provide repeat visitation, durable consumer demand, premium pricing power and high-value physical monetization of Disney’s intellectual property portfolio, the firm said.

Disney plans to expand its cruise fleet from eight ships today to 13 by 2031. Linear television remains under pressure and theatrical performance remains volatile, Benchmark said. The firm believes Disney’s long-term value is increasingly tied to its ability to deepen engagement and monetize consumers across a broader physical and digital ecosystem.

In other recent news, Walt Disney Co. has been the focus of several analyst updates and regulatory developments. Wells Fargo has lowered its price target for Disney stock to $125 from $146, citing concerns over the company’s streaming strategy. Analyst Steven Cahall suggested that a return to Disney’s previous business model, emphasizing content production over distribution, could potentially boost the stock by about 40%.

On a more optimistic note, Rosenblatt reiterated a Buy rating with a $126 price target, expecting Disney’s upcoming fiscal third-quarter 2026 earnings report to slightly exceed consensus estimates. Wolfe Research also adjusted its outlook, reducing its price target to $131 from $134, while maintaining an Outperform rating, due to increased direct-to-consumer programming costs. Additionally, Disney, along with Netflix, saw relief as Canada’s government ordered a review of a rule that would have required large streaming services to spend 15% of their Canadian revenue on local content.

This decision could ease financial pressures on Disney’s streaming operations in Canada. Meanwhile, FCC Commissioner Anna Gomez accused the Trump administration of a censorship campaign against Disney and its ABC network, raising concerns over regulatory actions. This article was generated with the support of AI and reviewed by an editor.

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