Walt Disney Co (DIS)

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Analyst Sees Several Headwinds for Walt Disney (DIS) Stock
By: Schaeffer's Investment Research | June 29, 2023

• Keybanc downgraded DIS to "sector weight" from "overweight"

• Analysts are still leaning bullish on DIS

Walt Disney Co (NYSE:DIS) received a downgrade from Keybanc to "sector weight" from "overweight." The firm cited a myriad of reasons, including slowing subscriber growth for Disney+, structural changes in content distribution, and its new labor contract in Florida that is likely to pressure margins. DIS is inching lower after the bear note, down 0.7% at $88.22 at last glance.

Support at the $87 level appears to have kept a lid on losses, though pressure at the $95 level and 40-day moving average still lingers above. Year-to-date, the security is up a slim 1.7%. It's worth noting that DIS' 14-day relative strength index of 31.6 sits on the cusp of "oversold" territory, which would indicate a short-term bounce is on the way.

The majority of the brokerage bunch is bullish. Of the 22 analysts in coverage, 20 carry a "buy" or better rating on Walt Disney stock. Plus, the 12-month consensus price target of $116.92 is a 32% premium to current levels.

Options traders are pricing in extremely low volatility expectations at the moment. DIS' Schaeffer's Volatility Index (SVI) of 22% ranks in the lowest percentile of its annual range.

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