The Walt Disney Company will report its 3rd quarter fiscal results this Wednesday. We await a look at how the weak performing Narnia: Prince Caspian affected the studios performance and if rising gas prices and reduced flight schedules have already begun to change the numbers expected from Disney’s parks and resorts.
Analysts generally agree that Disney’s theme-park business could soften late this year and into the next. International visitation has been robust, but they worry that domestic visitation could slow as airlines cut flights and raise fares. Major airlines are shedding capacity at Orlando International Airport, a gateway for visitors to the Walt Disney World resort.
“The theme-park business won’t be nearly as bad as investors fear this quarter,” Pali Capital Inc. analyst Rich Greenfield said. “But 2009 is much less clear and our concern grows substantially,” at the end of this year.
Since profits (gain or loss) tend to lag actual results and Disney had probably taken internal measures to tighten the belts, the third quarter numbers will probably be good. Everyone will be paying close attention to what the future might bring.
I’m not a stock analyst by any stretch of the imagination, but if Disney stock drops much below $30 I have to think about adding more of it to my portfolio. The long term value is not going anywhere.
[ via WSJ Online]