The Walt Disney Company (DIS): A Bull Case Theory

We came across a bullish thesis on The Walt Disney Company on LongYield’s Substack. In this article, we will summarize the bulls’ thesis on DIS. The Walt Disney Company's share was trading at $104.47 as of November 28th. DIS’s trailing and forward P/E were 15.25 and 15.75 respectively according to Yahoo Finance.

The Walt Disney Company operates as an entertainment company in Americas, Europe, and the Asia Pacific. It operates in three segments: Entertainment, Sports, and Experiences. DIS enters FY-2026 after a year of meaningful progress in profitability, cash generation, and strategic refocusing across its diversified media and experiences portfolio.

FY-2025 adjusted EPS grew 19%, extending a strong multiyear earnings trajectory and enabling management to significantly increase capital returns, including a planned $7 billion share-repurchase program and a 50% dividend hike. Disney generated $94.4 billion in revenue and $17.6 billion in segment operating income, supported by improvements across Entertainment, Sports, and Experiences.

The Entertainment segment benefited from a record box-office slate, strong consumer-products sales, and the profitable scaling of Disney+ and Hulu, which together reached 196 million subscribers. Streaming profitability marked an inflection point, driven by higher ARPU, tighter marketing spending, and plans to consolidate Disney+ and Hulu into a single app to streamline engagement and bundling. ESPN also advanced its direct-to-consumer transition, launching a feature-rich standalone service and reinforcing bundling momentum, while renewing key sports-rights agreements.

Experiences delivered record results as domestic and international parks, cruise lines, and consumer products continued to show resilience despite macro and weather-related pressures. The industry backdrop remains complex—streaming competition is intensifying, cord-cutting is accelerating, and sports-rights inflation persists—but Disney’s YouTube TV agreement demonstrated its willingness to embrace flexible distribution partnerships that expand reach and strengthen monetization.

Risks include sustaining streaming margins, navigating linear-network declines, and executing large-scale park and cruise investments. Still, with strong FY-2026 guidance—targeting double-digit entertainment growth, a 10% DTC margin, and continued expansion in experiences—Disney appears positioned to build on its momentum. FY-2025 ultimately showed that Disney can grow earnings while reshaping its business model, creating a compelling setup for the year ahead.

Previously we covered a bullish thesis on The Walt Disney Company (DIS) by Johnson Equity Analysis in May 2025, which highlighted Disney’s strength across entertainment, sports, and experiences and its long-term free-cash-flow rebound potential. The company’s stock price has depreciated approximately by 4.78% since our coverage. This is because the thesis didn’t fully play out. The thesis still stands as Disney continues executing its strategic reset. LongYield shares a similar view but emphasizes the FY-2026 earnings momentum.

The Walt Disney Company is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 111 hedge fund portfolios held DIS at the end of the second quarter which was 104 in the previous quarter. While we acknowledge the potential of DIS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.