DIS · Walt Disney
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $128.03
Note written ·
Price against the kill line
7.1% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $128.03, on record since 11 November 2026. The shares are up 14.9% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $128.03, which would put the shares above the 52-week high and around the analysts' consensus target and show them leading the S&P 500. Also fiscal 2027 guidance on 17 November 2026 that raises the adjusted EPS growth target above double digits and gives a dollar savings figure.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Consumer Discretionary
Quarter to 27 June 2026, filed 5 August 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 25,248
- Revenue, change on a year (%)
- +6.8
- Operating margin (%)
- 22.0
- Free cash flow, four quarters ($M)
- 8,293
- Net cash, cash less debt ($M)
- −40,856
- Price to earnings (×)
- 23.9
- Enterprise value to sales (×)
- 2.5
- Enterprise value to operating income (×)
- 13.5
All filed numbers
What Walt Disney reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Operating margin (%) |
|---|---|---|---|
| first filed | 25,248 | +6.8 | 22.0 |
| first filed | 25,168 | +6.5 | 18.3 |
| first filed | 25,981 | +5.2 | 17.7 |
| first filed | 22,464 | −0.5 | 15.5 |
| first filed | 23,650 | +2.1 | 19.3 |
| first filed | 23,621 | +7.0 | 18.8 |
| Pre-tax income ($M) | 3,645 |
| Net income ($M) four quarters: 8,600 | 2,638 |
| Diluted shares, change on a year (%) against the quarter to 28 June 2025 | −3.4 |
| Operating cash flow ($M) | 16,989 |
| Capital spending ($M) | 8,696 |
| Free cash flow ($M) | 8,293 |
| Cash and short-term investments ($M) | 5,185 |
| Debt ($M) non-current long-term debt plus current maturities | 46,041 |
| Net cash, cash less debt ($M) | −40,856 |
| Deferred revenue ($M) +1.9% on a year | 7,095 |
| Backlog, orders not yet delivered ($M) 0.0% on a year | 16,000 |
| Receivables ($M) | 14,553 |
| Inventory ($M) | 2,081 |
| Shareholders' equity ($M) | 110,032 |
| Market value ($M) | 205,424 |
| Enterprise value, market value plus net debt ($M) | 246,280 |
| Enterprise value to sales (×) | 2.5 |
| Enterprise value to operating income (×) | 13.5 |
| Price to earnings (×) | 23.9 |
| Price to book value (×) | 1.9 |
| Free-cash-flow yield (%) | 4.0 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 1.2% of shares outstanding sold short, 2.4 days of average trading to cover, +4.2% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $5.1M |
| 12 monthsfrom | $2.1M | $6.4M |
The thesis
The Walt Disney Company's shares look more likely to trail the S&P 500 than lead it over the next three months. They gained 14.2% in three months, which already reflects the parks, streaming and cost-cutting gains. The fiscal fourth-quarter report on 17 November 2026 decides whether that bar is met. It shows whether fiscal 2027 adjusted earnings per share (EPS) growth guidance goes beyond the double-digit target, and whether the job cuts come with a dollar savings figure.
Fiscal 2027 starts from a harder comparison. Disney's August shareholder letter put the extra 53rd week at about $600 million of the guided $4.9 billion fourth-quarter segment operating income (TheStreet, 10 November 2026). Fiscal 2026 adjusted EPS growth is about 16% with that week and about 12% without it. Sports costs rose again on 9 November 2026, when the College Football Playoff and ESPN agreed a five-year expansion to 24 teams. Reports value it at nearly $1.7 billion, with ESPN paying about $345 million a year on top of its existing contract.
The rating is Low because the shares closed at $119.65 on 11 November 2026, 1.0% below their 52-week intraday high, before the report has tested any of this. The price already reflects a solid quarter and a clean fiscal 2027 outlook. MarketBeat's consensus target of $128.16 across 21 firms (11 November 2026) implies little more than the recent run.
Bullish and bearish views on The Walt Disney Company
The bull case on The Walt Disney Company (DIS), in brief: parks still carry the profit. The bear case: the extra week will not recur.
Bull case
- Parks still carry the profit. Experiences operating income rose 20% to $3.02 billion in fiscal Q3 2026 (company release, 5 August 2026). Morgan Stanley estimates Disney Cruise Line revenue at about $5.1 billion in fiscal 2027, with each new ship adding roughly $600 million to $700 million a year as it matures (TheStreet, 10 November 2026).
- Streaming profit more than doubled. Entertainment streaming operating income rose to $712 million in fiscal Q3 2026 from $329 million a year earlier (company release, 5 August 2026).
- Job cuts could lift fiscal 2027 earnings. Bloomberg reported on 2 November 2026 that Disney is moving toward thousands of job cuts and has asked some managers to target 20% annual savings; Disney declined to comment. On 6 November 2026, Dan Ives of Yorkville Ives repeated his Outperform rating and $125 target, saying the cuts under Chief Executive Josh D'Amaro will lift earnings (Benzinga).
- Analysts are raising targets. Morgan Stanley raised its target to $133 from $125 on 4 November 2026 and models fiscal 2027 EPS of $7.39. Citigroup raised its target to $140 from $135 on 16 October 2026 (MarketBeat).
- Eight straight earnings beats. MarketBeat counts Disney ahead of the EPS consensus in each of its last 8 quarters (6 November 2026). Fiscal Q3 adjusted EPS of $2.06 rose 28% and beat a $1.85 consensus (5 August 2026).
- Buybacks shrink the share count. Disney repurchased $7.245 billion of stock in the first nine months of fiscal 2026, against $2.496 billion a year earlier, and targets at least $9 billion for the year (24/7 Wall St., 3 November 2026).
Bear case
- The extra week will not recur. The 53rd week adds about $600 million to fourth-quarter segment operating income and about 1.5% to 2% to quarterly revenue (TheStreet, 10 November 2026). Fiscal 2027 growth has to be built without it.
- Entertainment had a weak quarter. Chief Executive Josh D'Amaro said the live-action Moana and Star Wars: The Mandalorian and Grogu fell short at the box office. Disney expects Moana and softer advertising demand to weigh on fourth-quarter Entertainment results (TheStreet, 10 November 2026).
- Advertising growth is slow. TheStreet reported that advertising revenue rose 3% in fiscal Q3 while subscription revenue rose 15% (10 November 2026). Netflix cut its 2026 advertising outlook to about $2.7 billion from about $3 billion on 20 October 2026.
- Sports costs are climbing. The 9 November 2026 College Football Playoff deal adds about $345 million a year in ESPN payments for five years, on top of about $1.3 billion a year it already pays (Saturday Down South, citing ESPN). Sports operating income fell 17% to $858 million in fiscal Q3 (5 August 2026).
- Executives sold into the rally. Chief Legal and Global Affairs Officer Horacio Gutierrez sold 20,552 shares at $120.00 on 5 November 2026 under a Rule 10b5-1 trading plan (SEC Form 4). Executive Vice President Brent Woodford exercised options and sold 3,618 shares at $117.00 on 4 November 2026 and 6,474 shares at $111.98 on 2 November 2026, also under a plan.
- Savings may be reinvested. Reports on the 2 November 2026 Bloomberg story say part of the savings may go back into film, television, technology, parks and cruise ships. Disney had disclosed no dollar savings figure or restructuring charge as of 11 November 2026.
Price setup
Disney closed at $119.65 on 11 November 2026, 1.0% below the 52-week intraday high of $120.80 set on 5 November 2026. The shares rose 14.2% over three months from a $104.80 close on 13 August 2026. They traded between $116.75 and $119.65 at the close from 4 November to 11 November 2026.
The 50-day moving average is $108.76 and the 200-day moving average is $103.27, both as of 11 November 2026 on adjusted daily closes. The 52-week closing low is $92.42, set on 27 March 2026.
Nothing is left for the report to reveal before it lands. The price sits near the high and moved up as cost-cut reports and a higher Morgan Stanley target came out, and MarketBeat put the trailing price-to-earnings ratio at 24.59 on 11 November 2026. The next price move is likely to follow the 17 November 2026 report's fiscal 2027 outlook more than any news before it.
Catalysts ahead
- 17 November 2026: Fiscal Q4 and full-year 2026 results before the open, webcast at 8:30 a.m. ET, with fiscal 2027 guidance. Tests the guided $4.9B Q4 segment operating income and whether fiscal 2027 adjusted EPS growth guidance goes beyond double digits without the 53rd week. It also shows how much of the job-cut savings reaches profit.
- ~25 November 2026 (est.): Hexed theatrical release from Disney Animation. An early read on a film slate that has already missed with the live-action Moana and that BofA Securities flags as lighter in fiscal 2027.
- 18 December 2026: Avengers: Doomsday theatrical release. The largest film of fiscal 2027 and the main offset to concerns about weaker Entertainment results.
- 14 February 2027: Super Bowl LXI streams on Disney+ alongside ABC and ESPN. The largest live-sports test of Disney+ and of its advertising sales, which grew 3% in fiscal Q3.
What would change the view
A daily close above $128.03, which would put the shares above the 52-week high and around the analysts' consensus target and show them leading the S&P 500. Also fiscal 2027 guidance on 17 November 2026 that raises the adjusted EPS growth target above double digits and gives a dollar savings figure.
What it trades with
Experiences is Disney's largest profit segment, so a slowdown in consumer travel spending would hit the shares through it. The streaming advertising line ties the outlook to Netflix, whose 20 October 2026 ad outlook cut is the most recent industry marker. Sports rights tie the Sports segment to football deals. Those include the 9 November 2026 College Football Playoff expansion and Ligue 1 TV rights in France, which Bloomberg reported on 9 November 2026 that Disney and Skydance are weighing. The Federal Communications Commission's early review of eight ABC-owned station licenses is a risk specific to Disney.
The evidence, claim by claim (8)
- Fiscal Q3 2026 revenue $25.2B, +7% year over year; adjusted EPS $2.06, +28%, versus a $1.85 consensus. Disney Q3 FY2026 earnings release (8-K exhibit 99.1) · as of
- Experiences operating income $3.02B, +20%; Sports operating income $858M, −17%; streaming operating income $712M versus $329M a year earlier. Disney Q3 FY2026 earnings release (8-K exhibit 99.1) · as of
- The 53rd week adds about $600M to guided Q4 segment operating income of $4.9B; fiscal 2026 adjusted EPS growth is about 16% including it and about 12% excluding it. TheStreet, carried by AOL · as of
- Disney expects the live-action Moana and softer advertising demand to weigh on fiscal Q4 Entertainment results; Q3 advertising revenue rose 3%, subscription revenue 15%. TheStreet, carried by AOL · as of
- The College Football Playoff and ESPN agreed a five-year, nearly $1.7B deal to expand to 24 teams from 2027, about $345M a year on top of ESPN's existing payments. Saturday Down South, citing ESPN reporting · as of
- Consensus rating Moderate Buy from 21 firms; average price target $128.16. MarketBeat · as of
- Chief Legal and Global Affairs Officer Horacio Gutierrez sold 20,552 shares at $120.00 on 5 November 2026 under a Rule 10b5-1 plan. SEC Form 4 filed 6 November 2026 · as of
- Disney repurchased $7.245B of stock in the first nine months of fiscal 2026, versus $2.496B a year earlier, and targets at least $9B for the year. 24/7 Wall St. · as of
Sources
- Disney's next earnings come with an unusual $600 million boost · aol.com ·
- The Walt Disney Company (NYSE:DIS) Stock Has Consensus Target Price of $128.16 According to Analysts · marketbeat.com ·
- College Football Playoff, ESPN reach 5-year deal for expansion to 24 teams valued at over $1 billion · saturdaydownsouth.com
- Walt Disney Co - Form 8-K - FY2026 · sec.gov
- Disney Set for 'Next Chapter of Growth': Dan Ives Says Job Cuts to Unlock Earnings Power · benzinga.com
- Disney's New CEO Is Eyeing Thousands of Job Cuts, Two Weeks Before Earnings · 247wallst.com ·
- Disney Eyes Thousands of Layoffs, With Managers Asked to Cut 20% · finance.yahoo.com
- Walt Disney (DIS) Q4 2026 Earnings Date, Time & Estimates · marketbeat.com
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