Walt Disney rises as Wall Street sees Q3 results, guidance as 'turning point'
Wirestock
Walt Disney (NYSE:DIS) shares gained nearly 5% higher on Thursday after the media and entertainment giant reported third-quarter results and said it would raise prices on its streaming services, leaving some on Wall Street to see this as a potential inflection point for the storied company.
Bank of America analyst Jessica Reif Ehrlich reiterated her buy rating and $135 price target on Disney (DIS), noting the results were "solid." Reif Ehrlich also pointed out that the company provided "new areas of optimism," including its outlook for fiscal 2023, the expectation that Disney+ net additions will accelerate in the fourth-quarter and the potential to save more than the $5.5B that it initially outlined. 
"While several strategic questions remain (e.g. future of Linear, Film, etc.), we remain confident in Bob Igerâs ability to navigate the company through this transition period," Reif Ehrlich wrote in a note.
Additionally, Reif Ehrlich said given the latest guidance and cost-cutting initiatives, consensus estimates are likely to be "biased to the upside" and updates on the company's strategic goals "could drive multiple expansion back toward their historical premium levels." 
Netflix (NFLX) and Warner Bros. Discovery (WBD) finished higher, while Paramount Global (PARA) (PARAA) fell 1%.
Wells Fargo analyst Steve Cahall, who rates Disney (DIS) shares overweight, said "everything is on the table" when it comes to the turnaround, including further cost cuts, content shake-ups, selling off assets and more. 
"It now seems like a lot is on the table and we'd expect the updates to focus on how to improve content, which Bob Iger referenced on the earnings call and remains critical," Cahall wrote in an investor note, referencing the company's investor event next month.
Additionally, Cahall said the event may include an updated outlook for streaming and when cost improvements will allow its direct-to-consumer business to break-even in fiscal 2024 and potential changes to the company's portfolio, such as selling its linear television assets, excluding ESPN and content houses, as well as any updates on ESPN's direct-to-consumer transition. 
Morgan Stanley analyst Benjamin Swinburne, who has an overweight rating and $105 price target on Disney (DIS), said the company is really benefiting from the profitable growth of its Parks segment, which generated 13% year-over-year growth in revenue ($8.33B) and 11% year-over-year growth in operating income to $2.43B.
"This is a real investment positive as Disney takes meaningful but challenging steps towards improving the earnings power of its Media assets," Swinburne explained. 
"Overall, we see the [fiscal third-quarter] results reinforcing our OW thesis as overall DPEP growth remains healthy and the company is taking substantive cost, pricing, and windowing steps to improve the earnings power of its underearning media assets (5-10% DMED margins against a $55bn+ revenue base)," Swinburne added.
More on Disney's earnings

Disney Delivered Where It Mattered Most
The Walt Disney Company Q3 2023 Earnings Call Transcript
Disney earnings call: More streaming price hikes amid pivot toward profits