Disney (NYSE:DIS) stock is slipping on Friday after the entertainment company’s shares were hit with a downgrade.
Wolfe Research analyst Peter Supino dropped shares of DIS stock to a “peer perform” rating from an “outperform” rating. For the record, the analyst consensus rating for DIS is a “strong buy” on TipRanks, based on 16 analyst opinions.
Another blow to DIS stock comes from Supino suspending his price target for the company’s shares. For perspective, the analyst consensus price target for Disney is $128.79 per share. The stock closed out yesterday at $92.31 per share.
What’s Behind the DIS Stock Downgrade?
Here’s what the Wolfe Research analyst had to say about DIS stock in a note to clients obtained by CNBC:
“After yesterday’s 8.7% tumble and with strong Parks and cost reduction trajectories, we expect valuation support […] Today’s late cycle consumer environment and deteriorating DTC and linear revenue growth leave us more concerned about forecasting risk and time decay.”
That 8.7% drop Supino is referring to followed Disney’s earnings report for the first quarter of 2023. The company noted a loss of 4 million paid subscribers during the quarter. This unnerved investors despite Disney matching EPS estimates and beating revenue estimates.
DIS stock is also incredibly active today with some 8.5 million shares on the move as of this writing. That’s closing in on the company’s daily average trading volume of around 9.5 million shares. This comes as shares fall nearly 1% as of Friday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.