can't stay out of the news lately.
After a brief transition phase in which new chief Bob Iger focused on moving past the painful end of the Michael Eisner era, the Burbank, Calif., media giant has spent the new year wheeling and dealing. Two weeks ago the company pulled the trigger on a $7.4 billion acquisition of animation powerhouse
bolstering its movie studio and infusing fresh creative talent.
Now, come Monday afternoon, Disney is due to give Wall Street an update on the financial side of things -- along with possible news on the long-pending sale of its radio operations.
Disney's first-quarter results should be solid. Bright spots should include ongoing secular strength in its major TV franchises, steady performance at the theme parks and an uptick in filmed entertainment. Analysts will be looking for earnings of 30 cents a share, down from 34 cents a year ago, on $8.9 billion in revenue.
Iger, who took over last fall after Eisner hung on following a no-confidence vote from investors, has been credited with transforming Disney. He has trimmed Eisner's famously Byzantine internal management structure and put together savvy deals to get ABC and ESPN content on new platforms like the
How much fruit those arrangements will yield down the road remains to be seen. But it is widely accepted that the Apple deal helped soften Pixar Chairman Steve Jobs to the Pixar deal, which in turn should help Disney by adding Jobs' famous entertainment-industry vision to Disney's often lackluster board.
Success has not been easily won when it comes to the company's share price, however. Since Iger took over last fall, Disney shares have risen 5%, while the big-cap
is up 7%.
One dangling issue that could soon be tied up is the sale of Disney's radio properties. A deal with
in the works. Sources say the transaction could yield nearly $3 billion for assets that include radio stations in the nation's most-sought after markets.
To see Sandy's video preview of this week's media-sector action, click here
Overall, most analysts seem to feel pretty good about the direction of the company and recent performance.
"We continue to rank Disney outperform/neutral and highest within our entertainment coverage universe based on a combination of its above average growth and returns with 15%+ appreciation potential," wrote Goldman Sachs analyst Anthony Noto in a note ahead of the Pixar acquisition. Goldman seeks to do business with Disney.
"Disney's growth is less dependent on an advertising or economic recovery reflecting ratings gains at ABC, visibility of cable net affiliate fees, TV syndication for the first time since 1998 ($1 billion over the next five years) TV DVD release of 5+ successful new shows, the most optimistic film slate since 2003, and theme parks margin expansion," Noto said.
Following a dismal run for the company's filmed entertainment unit, Prudential also expects the studio division to return to profitability, thanks to solid returns from
The Chronicles of Narnia
. It also anticipates that parks income should be strong, thanks to record attendance levels at Walt Disney World and Disneyland.
On Friday, Disney shares fell 9 cents to $25.01.