Disney (DIS) Stock Climbs Amid Record Projections for 'Star Wars' Movie

Disney (DIS) stock is advancing in afternoon trading on Thursday, as analysts expect that its upcoming 'Star Wars' movie will more than double December's prior box office record.
By Rachel Graf ,

NEW YORK (TheStreet) -- Disney (DIS) - Get Report stock is increasing 0.59% to $118.84 in afternoon trading on Thursday, as analysts forecast that its upcoming "Star Wars" movie, which premiers on December 18, will bring in more than $200 million during its opening month, MarketWatch reports.

So far, movies have failed to surpass the $100 million mark for the month of December.

A number of analysts have forecast that the movie will generate enough in its debut to top "Jurassic World'"s $208.8 million to score the year's biggest opening, MarketWatch adds.

Ticket pre-sales for the movie began last month, and ultimately crashed ticket sites unable to handle the high demand. 

"This movie has analysts and the whole industry all aflutter," Rentrak media analyst Paul Dergarabedian told MarketWatch. "For many people 'Star Wars' is what got them into going to the movies. Let's say it opens lower than expected, and then goes on to be one of the highest grossing films. That's still a big deal."

Additionally, "Star Wars" toys could rake in $2 billion in sales during the last four months of 2015, Oppenheimer analyst Sean McGowan said, the Wall Street Journal reported.

Based in Burbank, CA, Disney is an international family entertainment and media enterprise with five business segments: media networks, parks and resorts, studio entertainment, consumer products and interactive media.

Separately, TheStreet Ratings team rates DISNEY (WALT) CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate DISNEY (WALT) CO (DIS) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and notable return on equity. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • DIS's revenue growth has slightly outpaced the industry average of 7.0%. Since the same quarter one year prior, revenues slightly increased by 9.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 29.26% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DIS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • DISNEY (WALT) CO has improved earnings per share by 10.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, DISNEY (WALT) CO increased its bottom line by earning $4.90 versus $4.25 in the prior year. This year, the market expects an improvement in earnings ($5.64 versus $4.90).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 7.3% when compared to the same quarter one year prior, going from $1,499.00 million to $1,609.00 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Media industry and the overall market, DISNEY (WALT) CO's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • You can view the full analysis from the report here: DIS

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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