KeyBanc analyst Brandon Nispel downgraded Disney to Sector Weight from Overweight without a price target. The company’s Domestic Parks expectations “appear high” and its direct-to-consumer subscriber growth has stalled, the analyst tells investors in a research note. The firm says Disney has failed to differentiate its streaming churn versus peers while ESPN moving to streaming is “materially harder” than thought. KeyBanc’s survey work shows low willingness for consumers to pay for ESPN. The firm worries the 2024 financial setup for Disney “feels a lot like 2023.” As such, it prefers to step aside, acknowledging meaningful uncertainty, and waiting for further catalysts, “as buying the dip has been a losing trade.”
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