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Trends & Analysis
News

P&G shares rise despite Q3 sales miss

News

Gold continues to shine amid geopolitical worries

News

Crude oil dips for 3rd session after supply data

News

Is there an AI upside for AMD?

News

GBP/USD recovers following wage report

News

Buy the JPMorgan dip?

Asset Watch

Has Walt Disney rekindled its magic?

Tuesday, November 14, 2023

While Walt Disney posted mixed fourth-quarter earnings on Nov. 8, the old mantra of ‘less bad is good’ sent the stock soaring the following day. The conglomerate added seven million net new Disney+ subscribers, versus the 2.68 million expected, proving its streaming business continues to bolster the top line.

 

Management plans to decrease content spending from $27 billion in 2023 to $25 billion in 2024, which should increase the company’s free cash flow to $8 billion and allow for a resumption of its dividend.

 

CEO Bob Iger said, “We have a long-term view and this past year has been spent fixing things that needed to be addressed…. The long-term picture for Disney shareholders is quite bright.”

 

But with the fundamentals trending in the right direction, has the momentum turned in the bulls’ favour?

The grey rectangles highlight how Walt Disney has recorded two consecutive green closes above its 10-week moving average three times since mid-2022. The first two resulted in material upside over the following weeks, while the third generated a more than 4% rally.

As a result, Walt Disney is sporting a fourth iteration on the right side of the chart, so the current momentum should have more room to run. Also noteworthy, the stock roughly retested the 10-week MA all three times before moving higher, and last week’s low of $83.59 was right near the 10-week MA of $83.21.

Is this a new uptrend, or will the bears have the last laugh?


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