The shares of Walt Disney (NYSE: DIS) continue to decline, making an almost 18% drop in six months. This shouldn’t come as a surprise after the recent controversies, such as partnering with a male influencer dressed as Minnie Mouse on TikTok who angered parents on social media, as well as replacing the Seven Dwarfs from the classic fairytale ‘Snow White’ in an upcoming remake with a mix of non-Dwarf characters.
Disney’s Q3 earnings report from August 9 didn’t provide any relief either. Streaming losses continued to shrink, and Disney+ and Hulu suffered a 7.4% decline in subscribers from the previous quarter.
On the positive side, Disney’s parks and experiences segment had a 13% increase in revenue, which is a good sign. But it wasn’t good enough to prevent further losses in its stock price.
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Analysts still believe the stock price can recover
Analyst consensus on TipRanks holds a ‘moderate buy’ rating based on 20 analysts in the past three months.
Their target price is $110.71, or 34% higher than the current stock price of $82.47.
DIS stock technical analysis
The daily chart shows a descending triangle, which is a bearish pattern. The way it works is the price fails to make higher highs and is pushed lower and lower until the price breaks out of the lower trendline.
The $85 level was Disney’s strong support level and the triangle’s lower trendline, but it failed to hold the price on Thursday, August 24. Unless the price quickly recovers above $85 and this becomes a fake breakout, we could easily see $50 in the coming months.
DIS is also down 7.3% year-to-date, underperforming the S&P 500’s 16% return during the same period.
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