Have you been paying attention to shares of Walt Disney (DIS)? Shares have been on the move with the stock up 9.8% over the past month. The stock hit a new 52-week high of $124.69 in the previous session. Disney has gained 11.4% since the start of the year compared to the 11.7% move for the Zacks Consumer Discretionary sector and the 14.1% return for the Zacks Media Conglomerates industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 7, 2025, Disney reported EPS of $1.45 versus consensus estimate of $1.18 while it beat the consensus revenue estimate by 2.1%.
For the current fiscal year, Disney is expected to post earnings of $5.78 per share on $95.15 in revenues. This represents a 16.3% change in EPS on a 4.14% change in revenues. For the next fiscal year, the company is expected to earn $6.35 per share on $100.56 in revenues. This represents a year-over-year change of 10% and 5.69%, respectively.
Valuation Metrics
Though Disney has recently hit a 52-week high, what is next for Disney? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Disney has a Value Score of B. The stock's Growth and Momentum Scores are B and A, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 21.5X current fiscal year EPS estimates, which is not in-line with the peer industry average of 22.4X. On a trailing cash flow basis, the stock currently trades at 12.7X versus its peer group's average of 9.7X. Additionally, the stock has a PEG ratio of 1.81. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Disney currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Disney fits the bill. Thus, it seems as though Disney shares could have potential in the weeks and months to come.
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The Walt Disney Company (DIS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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