3 Dow Components Hit 52-Week Highs: KO, PFE, DIS

NEW YORK ( TheStreet) - Shares of the following Dow Jones Industrial Average components Coca-Cola ( KO), Pfizer ( PFE) and Walt Disney ( DIS) all hit 52-week highs on Monday.

Each of these stocks received a buy rating from TheStreet Ratings.

Coca-Cola

"Europe was KO's largest operating profit contributor in 2011, but faces a tough 2012 due to weak economies, bottler pricing, French taxes, and FX," JPMorgan analysts wrote in a March 12 report. The analysts added, "The stock has underperformed the market and staples for the past 5 months, so we see limited downside from here."

Shares of Coca-Cola hit a 52-week high of $71.89 Monday. The stock's 52-week low of $63.34 was set on Oct. 4.

Coca-Cola's stock trades at an estimated price-to-earnings ratio for next year of 16.04 times; the average for soft drink companies is 18.33X. For comparison, Pepsico ( PEP) has a lower forward P/E of 14.83X.

Nineteen of the 24 analysts who cover Coca-Cola rate it at buy; five analysts give the stock a hold rating.

TheStreet Ratings gives Coca-Cola an A grade with a buy rating and $82.49 price target. The stock has risen 2.73% year to date.

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Pfizer

"In July 2011, Pfizer announced a strategic review of the options for its Nutritionunit," Bank of America Merrill Lynch analysts wrote in a report Monday. "In our view, a sale remains the most likely outcome although Pfizer could still choose a spin-off to alleviate tax or anti-trust concerns. Recent press reports state second round bids were due on 5th March and it would appear that the auction process is now drawing to a close. Indicative pricing appears near the top of the $8-10bn range implying 4-5x 2012E sales of $2.2bn (BofAMLe) or ~18x EBITDA assuming a 25% margin, in-line with previous baby food deals including Nestle- Gerber (16x) and Danone-Numico (22x). If anti-trust and tax concerns are satisfied, we believe Pfizer may announce a sale of the unit as early as end 1H12."

Shares of Pfizer hit a 52-week high Monday of $22.26. The stock's 52-week low of $16.63 was set on Aug. 9.

Pfizer's stock trades at a forward P/E is 9.46X; the average for pharmaceutical companies is 32.52. For comparison, both Merck ( MRK) and Bristol-Myers Squibb ( BMY) have higher forward P/Es of 10.4X and 17.3X, respectively.

Twenty-one of the 27 analysts who cover Pfizer rate it at buy. Four analysts have a hold rating on the stock and two rate it at sell.

TheStreet Ratings gives Pfizer an A- grade with a buy rating and $28.52 price target. The stock has risen 2.61% year to date.


Walt Disney

"We expect DIS' F2Q results to reflect underlying strength at Media Networks andParks, partially offset by impaired Film due to the lackluster performance of John Carter (incurring a $200mn write-down in the Q)," Bank of America Merrill Lynch analysts wrote in a March 22 report. "More specifically, F2Q should benefit from: (1) healthy underlying national advertising trends, (2) solid affiliate fees, (3) improved attendance trends at Parks (with reduced discounting), (4) easier comps for Tokyo Disneyland (following F2Q11's earthquake drag of $25mn) and (5) Oprah cost savings at TV. Key offsets: (1) a pre-announced $80- 120mn loss at Studio (we est. a loss of $112mn), (2) Fantasy pre-launch costs, (3) 20 hours of additional ABC Family programming (+$35mn), (4) Japan channel launch costs (+$17.5mn) and (5) 9 more NBA games at ESPN."

Shares of Walt Disney hit a 52-week high Monday of $44.30. The stock's 52-week low of $28.19 was set on Oct. 4.

Walt Disney shares trade at a forward P/E of 13X; the average for broadcasting and entertainment companies is 31.46X. For comparison, both News Corp ( NWS) and CBS ( CBS) have lower forward P/Es of 11.87X and 11.86X, respectively.

Twenty of the 34 analysts who cover Walt Disney rate it at buy; 14 analysts give the stock a hold rating.

TheStreet Ratings gives Walt Disney an A+ grade with a buy rating and $50 price target. The stock has risen 17.81% year to date.

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-- Written by Alexandra Zendrian in New York.

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