In This Article:
Increase in profitability and industry-beating performance can be essential considerations in a stock for some investors. In this article, I will take a look at The Walt Disney Company’s (NYSE:DIS) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. View our latest analysis for Walt Disney
How DIS fared against its long-term earnings performance and its industry
For the most up-to-date info, I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This technique enables me to assess different companies on a more comparable basis, using the latest information. For Walt Disney, its latest trailing-twelve-month earnings is US$11.47B, which, in comparison to the previous year’s level, has risen by 24.27%. Since these figures are relatively short-term, I have estimated an annualized five-year figure for DIS’s net income, which stands at US$7.53B This means that, generally, Walt Disney has been able to increasingly grow its net income over the last few years as well.
What’s the driver of this growth? Let’s see whether it is solely because of an industry uplift, or if Walt Disney has seen some company-specific growth. Over the past few years, Walt Disney increased its bottom line faster than revenue by effectively controlling its costs. This resulted in a margin expansion and profitability over time. Scanning growth from a sector-level, the US media industry has been growing its average earnings by double-digit 25.63% in the previous year, and a less exciting 8.29% over the last five years. This suggests that whatever tailwind the industry is benefiting from, Walt Disney has not been able to leverage it as much as its industry peers.
What does this mean?
Walt Disney’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While Walt Disney has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research Walt Disney to get a better picture of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for DIS’s future growth? Take a look at our free research report of analyst consensus for DIS’s outlook.
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Financial Health: Is DIS’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
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Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2018. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.