Walt Disney Stock Pulls Back to Support – Smart Entry?
Walt Disney (DIS) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($102.23 – $112.99), levels from which it has bounced meaningfully before. In the last 10 years, Walt Disney stock received buying interest at this level 3 times and subsequently went on to generate 39.2% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 4/4/2019 | 33.0% | 236 |
| 7/1/2020 | 19.9% | 58 |
| 9/24/2020 | 64.8% | 165 |
Walt Disney (DIS) is near a key support zone, with recent developments presenting a mixed picture. While Q4 FY25 earnings saw revenue miss expectations due to ongoing linear television declines, robust growth in its digital content platforms and record performance from its global destination experiences strengthen the underlying business fundamentals. Increased shareholder returns through boosted dividends and share repurchases, coupled with generally positive analyst sentiment for 2026, suggest a rebound is probable despite the initial post-earnings stock dip. However, the immediate market reaction was negative, making a quick bounce uncertain.
Here are some quick data points for Walt Disney that should further help the decision:
- Revenue Growth: 5.0% LTM and 5.3% last 3 year average.
- Cash Generation: Nearly 12.2% free cash flow margin and 14.8% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in last 3 years for DIS was 2.5%.
- Valuation: DIS stock trades at a PE multiple of 16.8
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| DIS | S&P Median | |
|---|---|---|
| Sector | Communication Services | – |
| Industry | Movies & Entertainment | – |
| PE Ratio | 16.8 | 23.5 |
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| LTM* Revenue Growth | 5.0% | 6.1% |
| 3Y Average Annual Revenue Growth | 5.3% | 5.4% |
| Min Annual Revenue Growth Last 3Y | 2.5% | 0.2% |
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| LTM* Operating Margin | 14.8% | 18.8% |
| 3Y Average Operating Margin | 11.9% | 18.2% |
| LTM* Free Cash Flow Margin | 12.2% | 13.5% |
*LTM: Last Twelve Months
For more details on DIS fundamentals read Buy or Sell DIS Stock. Nevertheless, individual stocks can soar or tank but one thing matters: staying invested. High Quality Portfolio helps you do that.
What Is Stock-Specific Risk If The Market Crashes?
Disney isn’t immune to big sell-offs. It fell about 61% in the Dot-Com crash, 56% during the Global Financial Crisis, and nearly 61% in the recent inflation shock. Even smaller hits like the 2018 pullback and the Covid pandemic dragged it down 16% and 42%, respectively. Strong fundamentals matter, but when fear hits, Disney’s not off the hook.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read DIS Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.