Updated with information on Disney's stock price.
All it took was some soothing words, and a positive forecast some twelve months into the future.
Shares of Walt Disney (DIS) were rising Friday in the wake of CEO Bob Iger's pronouncement on the company's earnings call that investors can expect "robust growth" at the world's largest entertainment company beginning in the fourth quarter of 2017. Disney was gaining 3% on Friday morning after falling as much as 3% in after-hours trading on Thursday afternoon right after the results were released.
Investors were embracing Iger's forecast as a reason to buy shares in a stock that is trading at its lowest valuation in almost four years. Disney had lost 19% over the past year as of Thursday as sentiment on the company waned due to subscriber losses at ESPN, the very popular sports network, and uneven performance at its film and theme parks.
But after explaining that Disney expects its fiscal 2017 earnings, which begin in the current quarter, to generate "modest growth," Iger said an ambitious slate of Marvel films, two Star Wars releases and additional movies from Pixar and Disney Animation will fuel growth at its studios, as well as in the company's all-important consumer products unit starting in about a year.
"With modest growth due to some comparability factors that [CFO Christine McCarthy] will detail, fiscal 2017 will be an anomaly in our growth trajectory," Iger told listeners on the company's investor conference call. "We fully expect to return to more robust growth in fiscal 2018 and beyond."
Iger's focus on Disney's future was a stark contrast to the company's earnings for the September quarter, the last of its fiscal 2016 year.