One Reason Disney (DIS) Stock is Up

NEW YORK (TheStreet) --Shares of the Walt Disney Co. (DIS) are higher by 0.90% to $114.07 after the media and family entertainment company announced some changes to its management team.

Treasurer Christine McCarthy has been named as Disney's Chief Financial Officer, replacing the resigning Jay Rasulo. Kevin Mayer has been named Chief Strategy Officer of the company. The announcements were made by Disney CEO Bob Iger.

"[Christine McCarthy] is highly respected in the finance sector, and in this new role she will have even more impact on creating value for Disney shareholders," Iger said in a statement.

"With this promotion to the new role of Chief Strategy Officer [Kevin Mayer] will continue to focus on growth opportunities and help position the company for the future," Iger added.

Additionally, Disney announced on Monday that it is combining two of its businesses, consumer products and interactive, into a single operating unit.

"As technology and digital entertainment continue to evolve, a shared innovation strategy will enable this new segment to create unique and engaging products and experiences that exceed consumers' expectations," Disney COO Tom Staggs said in a statement.

Staggs is believed by many to be in line to replace Bob Iger when he steps down in 2018, the Associated Press reports. 

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, growth in earnings per share, increase in net income, notable return on equity and good cash flow from operations. 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 4.0%. Since the same quarter one year prior, revenues slightly increased by 7.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • DISNEY (WALT) CO has improved earnings per share by 13.9% 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 $4.25 versus $3.38 in the prior year. This year, the market expects an improvement in earnings ($5.08 versus $4.25).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Media industry average. The net income increased by 10.0% when compared to the same quarter one year prior, going from $1,917.00 million to $2,108.00 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.
  • Net operating cash flow has increased to $2,918.00 million or 15.47% when compared to the same quarter last year. In addition, DISNEY (WALT) CO has also modestly surpassed the industry average cash flow growth rate of 15.21%.
  • You can view the full analysis from the report here: DIS Ratings Report

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