- Disney scored a Wall Street-high price target late Monday after Rosenblatt analyst Bernie McTernan boosted his expectations for global Disney Plus subscribers.
- McTernan raised his price target for the media conglomerate to $US175, up from $US170 and about $US20 higher than average projection from Wall Street analysts, according to Bloomberg data.
- The bump was accompanied by McTernan raising his expectations for Disney Plus subscribers to 35 million by the end of 2020, up from a prior estimate of 10 million.
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Disney has a new biggest bull on Wall Street.
Rosenblatt Securities analyst Bernie McTernan raised his price target for the media conglomerate to $US175, from $US170. The figure is the highest out of any major analyst covering the stock and about $US20 above the average price target, according to data compiled by Bloomberg.
McTernan backed up his new price target by more than tripling his near-term forecast for global Disney Plus subscribers to 35 million by the end of 2020, up from a prior estimate of 10 million.
The graph below depicts the significant difference between McTernan’s prior and updated estimates for Disney’s streaming subscribers.
“The key question facing Disney shares is where do subscribers go from here,” McTernan wrote in a note to clients late Monday. “We believe 15-20M subscribers is a reasonable estimate for Disney+ currently.”
Based on the new estimates, McTernan also accelerated his long-term timeline for Disney to hit its 60 million to 90 million guidance range for streaming customers. He now expects the company to enter that range by the end of 2022, two years earlier than a previous prediction of 2024.
Rosenblatt also administered its own streaming video survey to assess awareness and interest in new platforms. According to the most recent reading from over the weekend, 84% of respondents were aware of Disney Plus,compared to 63% from a prior survey on October 27th.
According to McTernan, Disney Plus’s international rollout will be a key driver for subscribers in the short-term, as well as potential promotions during the upcoming holiday season.
Disney’s stock price spiked as much as 6.5% last week after the company announced its new streaming platform exceeded 10 million sign-ups less than 48 hours after launch. It’s still unclear how many sign-ups were free trials compared to paying subscribers.
Shares of Disney are up about 36% year-to-date.