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Disney Will Make a Comeback

Real Money's Stephen 'Sarge' Guilfoyle assesses disappointing results from media giant.

Fiscal fourth-quarter results for The Walt Disney Company DIS were disappointing, Real Money’s Stephen Sarge Guilfoyle acknowleges.

The entertainment company reported adjusted EPS of $0.37, GAAP EPS of $0.09 and revenue of $18.53 billion. Disney reported 26% year-over-year growth in revenue generation, but these three metrics did not meet Wall Street’s estimates.

However, Disney will make a comeback, especially since the U.S. is allowing travelers from other countries now, Guilfoyle says. The stock could reach $200, he wrote in a recent Real Money Pro column

“I came in long the name [ahead of earnings], and I have added” Guilfoyle wrote. “I still do not have an especially large position and can afford to be patient, which I intend to be. I am 3/8 of the way toward building what I would call a full position for this name.”

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Both of Disney’s two large segments “fell short of expectations for operating income, the smaller segment quite substantially,” he wrote. "The larger segment is Disney Media and Entertainment Distribution, which reported revenue of $13.084 billion, an increase of 9%. but remained less than estimates. The smaller segment, Disney Parks, Experiences, and Products, reported revenue of $5.45 billion, which is an increase of 99%, nearly doubling the fourth quarter of 2020 and beat Wall Street’s estimates.”

Disney CEO Bob Chapek said the company plans to almost double the ammount of original content from its marquee brands, Disney, Marvel, Pixar and Star Wars. The National Geographic channel will be added in 2022. He also estimates that the number of subscribers to increase in the second half of 2022.

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