Walt Disney: Color on qtr (71.76)
- FBR Capital raises its DIS tgt to $85 from $83, and taking FY14E adjusted EPS up $0.06 to $3.96 in reaction to an F1Q14 earnings report, post-close Wednesday, that, like many Disney qtrs, featured lumpiness and noise to look through but, on balance, was quite encouraging. The report illustrated the ability of Disney's improving film momentum to boost other segments-a point FBR emphasized in its preview. FBR also sees attractive pricing leverage that, in a low inflation world, is uniquely appealing.
- Needham notes DIS reported revenue of $12.3B (up 9% y/y and 1% above its ests), Segment Operating Profit of $3.0B (up 27% y/y and 12% above its ests), and Operating EPS of $1.04 (up 31% y/y and 15% above its ests). DIS underdelivered firm's revenue estimates for the Parks, Broadcasting and Cable Networks segments, but these shortfalls were entirely offset by strength at the Film segment which came in $200mm above firm's revenue estimate. Comparisons were aided by the absence of a UK business which was sold late last year, which lost money in FY1Q13.
- Stifel notes DIS reported FY1Q adj. EPS of $1.04 (30%+ y/y) which was $0.13 above both its estimate and consensus, while revenue of $12.31 bln (+9%) was generally in line (but strong in its opinion) ~ healthy profit growth (+27%; $233 mln ahead of its forecast) drove the beat. Firm was particularly encouraged by 1) affiliate fee growth (domestic up high single-digits) + ad trends (+10%) at ESPN; 2) Parks margins (20.6% ex- investments); 3) a strong box office for Studio Entertainment (adj. OI +75% y/y); 4) profits for Interactive (adj. OI $55 mln vs. $9 mln last year); and 5) aggressive share buybacks ($1.72 bln/pacing ahead of our original forecast).