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Quote this valuation with its source: Fair value, Potential value and the price at analysis.
FAQ
DIS — frequently asked questions
Is The Walt Disney Company overvalued?
In our latest published analysis dated 2026-05-08, DIS looks modestly undervalued. The price recorded at analysis is USD 109 versus our fair value of USD 114; the high endpoint is presented separately as potential value of USD 137. That implies roughly 5.0% upside to fair value at that date.
Our latest published report, analyzed 2026-05-08, gives DIS a fair value of USD 114 and a potential value of USD 137. The conclusion is triangulated across multiple valuation models and weighted by reliability for The Walt Disney Company's archetype; it is a dated research output, not a live price.
Should I buy DIS now?
Our latest published rating for DIS, analyzed 2026-05-08, is Hold. The Walt Disney Company looks modestly undervalued at the analysis-date price of USD 109 versus fair value of USD 114; potential value is USD 137. This is research for educational purposes, not personalized investment advice.
What are the biggest risks for DIS?
The dedicated bear-case section in our report analyzed 2026-05-08 documents The Walt Disney Company's material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.
What is DIS's rating?
Our latest published rating for DIS, analyzed 2026-05-08, is Hold, with a published moat assessment of 9/10 (Wide). It reflects our fair value of USD 114, the potential value of USD 137, and the price recorded at analysis (USD 109).
Bull: Streaming achieves sustained double-digit operating margins faster than anticipated, Parks continue high-ROIC expansion with strong per-capita yields, and the theatrical slate regains peak box office dominance.
Main risk
Linear Collapse: Cord-cutting accelerates significantly faster than DTC profit replacement, permanently destroying enterprise margin.
Disney is a premier entertainment compounder successfully navigating the transition from linear television to streaming, heavily anchored by its high-margin Parks & Experiences segment. While near-term growth is tempered by linear declines, its unmatched, multi-generational IP portfolio secures a durable long-term moat.
Disney is a premier entertainment compounder successfully navigating the transition from linear television to streaming, heavily anchored by its high-margin Parks & Experiences segment. While near-term growth is tempered by linear declines, its unmatched, multi-generational IP portfolio secures a durable long-term moat.
Streaming rationalization driving industry-wide price increases and margin expansion.
House recommendation
Hold. The current valuation fairly reflects the balance between long-term IP durability and near-term transition costs.
Company overview
The Walt Disney Company operates as an entertainment company in Americas, Europe, and the Asia Pacific. It operates in three segments: Entertainment, Sports, and Experiences. The company produces and distributes film and television content under the ABC Television Network, Disney, Freeform, FX, Fox, National Geographic, and Star brand television channels, as well as ABC television stations and A+E television networks; and produces original content under the Disney Branded Television, FX Productions, Lucasfilm, Marvel, National Geographic Studios, Pixar, Searchlight Pictures, Twentieth Century Studios, 20th Television, and Walt Disney Pictures banners. It also provides direct-to-consumer streaming services through Disney+, Disney+ Hotstar, and Hulu; sports-related video streaming content through ESPN, ESPN on ABC, ESPN+ DTC, and Star; sale/licensing of film and episodic content to television and video-on-demand services; theatrical, home entertainment, and music distribution services; DVD and Blu-ray discs, electronic home video licenses, and VOD rental services; staging and licensing of live entertainment events; and post-production services. In addition, the company operates theme parks and resorts, such as Walt Disney World Resort, Disneyland Resort, Disneyland Paris, Hong Kong Disneyland Resort, Shanghai Disney Resort, Disney Cruise Line, Disney Vacation Club, National Geographic Expeditions, and Adventures by Disney, as well as Aulani, a Disney resort and spa in Hawaii. Further, it licenses its intellectual property (IP) to a third party that owns and operates Tokyo Disney Resort; licenses trade names, characters, visual, literary, and other IP for use on merchandise, published materials, and games; operates a direct-to-home satellite distribution platform; sells branded merchandise through retail, online, and wholesale businesses; and develops and publishes books, comic books, and magazines. The company was founded in 1923 and is based in Burbank, California.
A severe consumer recession combined with accelerated linear cord-cutting tests dividend sustainability and forces drastic capex rationalization across the Parks segment.
Accelerated cord-cutting outpaces streaming profit gains, while macroeconomic weakness pressures theme park attendance and per-capita spending, leading to compressed enterprise margins and stagnant FCF.
Macroeconomic softness curtailing theme park attendance and guest spending would compress overall operating profitability, reducing high-margin cash flows needed to fund digital entertainment investments.
Escalating churn in streaming services combined with elevated content production costs impairs core profitability, preventing the direct-to-consumer segment from achieving sustainable profitability.
Accelerated cord-cutting in traditional linear television networks outpaces streaming revenue gains, eroding predictable high-margin affiliate revenues and dampening enterprise-wide top-line expansion.
Extended elevated capital expenditures across parks and cruise lines absorb operational cash flow, restricting free cash available for debt reduction, dividend growth, and share repurchases.
Current:1.459 as of 2026-05-08
Alert if< 1.15 over any trailing twelve-month period
Repeated theatrical underperformance impairs the return profile on high-budget studio intellectual property, diminishing downstream monetization opportunities across consumer products and park attractions.
Current:7.0% as of 2026-05-08
Alert if< 5.0% over any trailing twelve-month period
Convert the revenue and margin path into after-tax free cash flow, discount the annual per-share amounts and at , then adjust for signed per current share.
Disney successfully navigates the transition from linear television to streaming, heavily anchored by its high-margin Parks segment. The unmatched IP portfolio secures a durable moat despite transition costs.
Warning level: < 11.5% over two consecutive quarters. Macroeconomic softness curtailing theme park attendance and guest spending would compress overall operating profitability, reducing high-margin cash flows needed to fund digital entertainment investments.
Warning level: < 34.0% over two consecutive quarters. Escalating churn in streaming services combined with elevated content production costs impairs core profitability, preventing the direct-to-consumer segment from achieving sustainable profitability.
Warning level: < 1.0% YoY over two consecutive quarters. Accelerated cord-cutting in traditional linear television networks outpaces streaming revenue gains, eroding predictable high-margin affiliate revenues and dampening enterprise-wide top-line expansion.
Warning level: < 1.15 over any trailing twelve-month period. Extended elevated capital expenditures across parks and cruise lines absorb operational cash flow, restricting free cash available for debt reduction, dividend growth, and share repurchases.
Warning level: < 5.0% over any trailing twelve-month period. Repeated theatrical underperformance impairs the return profile on high-budget studio intellectual property, diminishing downstream monetization opportunities across consumer products and park attractions.
