JPMorgan has maintained an Overweight rating and a $138.00 price target on Walt Disney Co (NYSE: DIS) after the company released its fiscal first-quarter results, a position that implies roughly 32% upside from the firm’s current trading level of $104.45. The bank cited the company’s decision to hold fiscal 2026 guidance even as second-quarter commentary signaled Entertainment and Sports contributions below prior consensus, suggesting the year may be more backloaded than previously expected.
Shares of Disney dropped 7% following the announcement despite several supportive performance signals. Management reported a 1% year-over-year increase in domestic parks attendance and an estimated 12% rise in streaming video-on-demand revenue when excluding the effect of the India joint venture. Over the trailing twelve months, Disney generated $94.42 billion in revenue, up 3.35% from the prior year.
JPMorgan analyst David Karnovsky attributed the stock’s weakness to investor concerns about the shape of the fiscal year and the company’s shift to provide less disclosure on Entertainment, calling the market’s selloff "explainable though overdone." The firm continues to view Disney as attractively valued at under 16 times forward earnings, a multiple the bank characterizes as a historically wide discount to the broader market and a narrow premium versus media peers.
Supporting that valuation view, InvestingPro data referenced by analysts shows Disney trading at a price-to-earnings ratio of 16.6 times and an unusually low PEG ratio of 0.11, metrics that underscore the bank’s thesis of upside relative to current expectations. The report also notes potential upside from resolution of CEO succession matters as a positive catalyst for the stock.
Operationally, Disney posted fiscal first-quarter revenue of $25.98 billion, a 5% increase from the prior year and marginally ahead of analyst forecasts. Adjusted earnings per share for the quarter were $1.63, about 5% above estimates. Despite those beats, operating income fell 9% year-over-year to $4.6 billion.
Analysts remain divided on the company’s strategic positioning. Needham raised the question of whether Disney is principally a content company or a real estate operator given that the Parks segment now represents 72% of segment operating income. That shift in profitability mix underlies debates over the firm’s long-term identity and investor priorities.
Other firms offered varying but generally constructive stances following the quarter. Morgan Stanley resumed coverage with an Overweight rating, citing expectations for double-digit adjusted EPS growth in fiscal 2026 and beyond. Barclays reiterated an Overweight rating, noting that several key segments marginally exceeded estimates despite mixed showings across Experiences and Streaming. BofA Securities kept a Buy rating in place, highlighting revenue growth of 5.2% to $26.0 billion as a positive surprise versus its own forecasts.
The range of analyst reactions highlights differing interpretations of Disney’s recent financial performance and strategic direction. Some firms emphasize upside tied to valuation and potential operational improvements, while others point to the uneven nature of results across parks, streaming and entertainment disclosure.
For investors, the immediate debate centers on whether the market’s response to reduced Entertainment-level disclosure and a potentially backloaded fiscal year is an overreaction or a legitimate reassessment of near-term growth visibility. JPMorgan’s stance suggests the former, anchoring its view in relative valuation and identifiable catalysts; market price action following the results illustrates the latter, with traders repricing uncertainty into the shares.
Contextual figures from the quarter and related analyst commentary:
- JPMorgan price target: $138.00, ~32% above current price of $104.45.
- Domestic parks attendance: +1% year-over-year.
- Streaming VOD revenue: estimated +12% excluding India joint venture impact.
- Trailing twelve months revenue: $94.42 billion, +3.35% year-over-year.
- Fiscal Q1 revenue: $25.98 billion, +5% year-over-year; adjusted EPS: $1.63.
- Operating income: $4.6 billion, down 9% year-over-year.
- Parks share of segment operating income: 72% per analyst commentary.
- Valuation metrics referenced: forward P/E roughly 16x; InvestingPro P/E 16.6x and PEG 0.11.