Disney Shares Gained Value!

Disney (NYSE:DIS) shares jumped more than 8% in pre-market trading on Thursday after the company reported stronger-than-expected Disney+ subscriber numbers for Q3.

The company reported Q3 adjusted EPS of $1.09, up from 80c a year earlier and above consensus estimates of 96c per share. Revenue was $21.5 billion, up 26% year-over-year and slightly above analyst consensus of $21 billion. Media and entertainment distribution revenues were $14.11 billion in the quarter, up 11% year-over-year, but below the consensus estimate of $14.33 billion. Disney reported revenue from parks, experiences and merchandise of $7.39 billion, up 70% year-over-year and beating expectations of $6.65 billion. Disney reported 152.1 million Disney+ subscribers in the quarter, up 31% year-over-year and above expectations of 148.4 million. "With 14.4 million Disney+ subscribers added in the fiscal third quarter, we now have a total of 221 million subscribers across our streaming offerings," CEO Bob Chapek said. A Guggenheim analyst upgraded Walt Disney to Buy from Neutral and set the price target at $145 (from $110). A Credit Suisse analyst sees a stronger long-term case for Disney after the company raised streaming prices. "We believe Disney+ will still be a profitable and valuable platform and are currently very discounted on Disney's valuation. The macro certainly increases uncertainty for FY23, but easy international parks and domestic visitation comparisons and Parks momentum, including the new cruise ship, point to FY23 growth potential even if the consumer environment weakens significantly. Over time, we see potential for Disney to recapture its premium valuation with profitability we expect to be above Street expectations post-recession." A Goldman Sachs analyst expects a positive market reaction to DIS' revised F2024 Disney+ subscriber targets, planned price increases and the resilience of DIS' Parks business. The analyst also raised his price target to $140 from $130.