Disney Gears Up for Highly Anticipated Earnings Report

Disney stock is hovering below its 2021 breakeven

Assistant Editor
May 13, 2021 at 1:18 PM
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Walt Disney Co (NYSE:DIS) stock is up 0.8% at $179.27 this afternoon, as the media powerhouse gets ready to announce its fiscal second-quarter earnings report, slated to take place after the close today. Pandemic-related restrictions forced Disney to close many of its theme parks, but those restrictions are now easing, and investors will look toward how Disney is recovering and how its Disney+ streaming services has been performing. Below, we'll take a look at the security's technical setup, and how the stock has fared after earnings in the past. 

Disney stock has traveled steadily lower on the charts since hitting an all-time high of $203.02. After keeping its head above the long-supportive 80-day moving average, the equity recently succumbed to the trendline and has closed below here during its last eight sessions. In addition, DIS is at risk of logging its second-straight close below the 120-day moving average, something the stock hasn't done since November of last year. Now down 0.9% in 2021, a positive earnings report could give the equity the boost it needs to turn things around.

DIS Chart May 13

Digging into the blue chip's earnings history, DIS has closed lower the day after the company reports in five of the last eight quarters, including a 1.7% decline after its last report in February. Looking back eight quarters, the shares have averaged a next-day move of 3.1%, regardless of direction. This time around, the options market is pricing in a slightly larger 5.4% move for tomorrow's trading. 

Despite its recent slide, analysts have been very optimistic lately, with 14 of the 18 firms covering DIS sporting a "buy" or better recommendation. Further, the stock's average 12-month price target of $209.81 is a 17.3% premium to current levels. Should Disney move higher after earnings, however, it could attract even more upbeat analyst attention.

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