New Price Target for Disney After 50% Rally
Shares of Walt Disney are breaking out of a multi-year base. Is it time to buy the stock?
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
Quick, think of a stock that has gained 50% over the past three months.
If you said Robinhood HOOD, you’d be right. In fact, shares of Robinhood have actually tripled over the past three months.
Shares of Coinbase COIN have doubled over that same period. We recently analyzed Robinhood and Coinbase, and set new price targets for both stocks.
If you thought of Meta Platforms META, you were this close. Meta has gained 48% since the April 21 close.
And if you thought of The Walt Disney Company DIS, you’d be correct. Disney shares have gained just over 50% since the April 7 open.
The Mouse Is Back
That’s right. Over the past three months, Disney is outperforming the overall market, and is even beating some of the top names in tech. Could it be that the House of Mouse is finally back on track? Let’s go to the charts to find out, starting with Disney’s daily chart.
Disney exploded higher after beating earnings and revenue estimates on May 7 (point A), and hasn’t looked back. The stock sailed above its 50-day (blue) and 200-day (red) moving averages, which then experienced a so-called golden cross (point B). Earlier this week, Disney climbed above a major resistance area (point C) to reach a new 52-week high.
However, if we zoom out to Disney’s weekly chart, a significant pattern is now visible. Shares of Disney have formed a huge rounded bottom pattern (shaded yellow) over the past three years.
Based on this bullish formation, and on the stock’s momentum, we can give Disney its new target price of $160. If the stock can break away cleanly from its rounded bottom pattern, it could reach that new price target quickly.
If that $160 target is achieved, it will be cheered by shareholders who haven’t had much to celebrate. Over the past five years, shares of Disney have gained just over 10%.
Disney gained attention earlier this week when the stock was upgraded from hold to buy by Jefferies analyst James Heaney. Heaney gave Disney a price target of $144, citing anticipated strength in amusement parks and cruises. Heaney also mentioned upcoming Disney films Zootopia 2 and Avatar 3 as potential catalysts for the stock.
At the time of publication, Ponsi was long DIS.
