Investors are looking ahead to blue-chip entertainment giant Walt Disney’s (DIS) fiscal fourth-quarter earnings report, due out after the close today. The stock is marginally higher ahead of the event, last seen up 0.6% at $176.22. Below, we’ll explore DIS’ technical setup and dig into some of its post-earnings past, to get an idea of what it could mean for the security going forward.
Walt Disney stock has traded mostly sideways for the last six months, with a floor at the $170 level since May, and several rally attempts thwarted by the $188 mark along the way. More recently, however, the security has faced pressure from the 200-day moving average, as well as the $180 area. DIS is also facing off with its 2021 breakeven level, sporting a 2.8% year-to-date deficit.
Daily chart of Walt Disney stock with 200-day moving average
The stock has a history of mixed post-earnings responses over the past two years. Over these last eight next-day sessions, Disney stock saw positive returns half of the time, averaging a 2.8% swing, regardless of direction. This time around, options players are pricing in a much bigger 6.7% move.
Options traders have been very optimistic over the past two weeks. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), DIS sports a 10-day call/put volume ratio of 3.58, which stands higher than 78% of readings from the past 12 months. This indicates calls are being picked up at a much quicker-than-usual clip.
Analysts are optimistic towards Disney stock as well. Of the 16 in coverage, 13 say “buy” or better, and the 12-month consensus price target of $207.72 is an 18% premium to the stock’s current perch.
