Disney share price trades off trendline support after Q1 results
The long-term uptrend for Disney looks to resume with analysts and IG clients also favouring a long bias to trades on the stock.
The Walt Disney Company
First-quarter (Q1) 2020 results for Disney have been met with a positive after-hours response, with the share price posting a 2% gain in the all session.
Some of the salient features of the results are as follows:
- Revenue +36% (Q1 2020 vs Q1 2019)
- Net Income -23% (Q1 2020 vs Q1 2019)
- Diluted earnings per share (EPS) from continuing operations -37% (Q1 2020 vs Q1 2019)
- Disney+ subscribers 26.5 million (launched in November 2019)
- ESPN+ subscribers 6.6 million (1.4 million in Q1 2019)
- Hulu subscribers 30.4 million (22.8 million in Q1 2019)
Technical view
The share price of Disney has posted a bullish reversal off the 200-day simple moving average (SMA) (blue line on chart). This indication is a suggestion that the long-term uptrend may now be resuming. The stochastic has also reversed sharply out of oversold territory, a bullish short-term consideration. With the trend bias and short-term momentum appearing to be up, 149.70 and 154.20 become the next upside resistance targets from the move higher. 135.85 marks a short-term low, and should the price instead retrace to close below this level, the trend bias would need to be reassessed.
Client view
97% of IG clients with open positions as of 5 February 2020 expect the price of Disney to rise in the near term.
Broker view
A Thomson Reuters analyst poll has an average long-term rating of ‘buy’ for Disney as of the 5 February 2020.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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