The Walt Disney Company (NYSE:DIS) Faces Fight for Fox
Last week, Comcast Corp. (ticker: CMCSA) officially outbid Walt Disney Co (DIS) for Twenty-First Century Fox (FOXA), putting Disney investors in a difficult situation. Regardless of the outcome of the Fox bidding, analysts say Disney shareholders could come out the losers.
Pivotal Research Group analyst Brian Wieser says Disney can’t afford to lose those critical Fox assets ahead of the highly anticipated 2019 launch of Disney’s standalone streaming video service. At the same time, Disney can’t afford to overpay for Fox without hurting the DIS stock price.
“If Disney has to pay a higher price for the Fox Entertainment assets because it engages in a bidding war with Comcast, Disney’s value would be negatively impacted as it would reduce the incremental value the company should be able to generate from synergies associated with the acquisition,” Wieser says.
GBH Insights estimates that DIS could realize up to $2 billion of cost synergies within the first 18 months of a completed Fox deal. However, Disney would need to raise its current Fox offer by $13 billion just to match Comcast’s $65 billion all-cash bid.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 103.86.
The projected upper bound is: 109.66.
The projected lower bound is: 102.80.
The projected closing price is: 106.23.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 21 white candles and 28 black candles for a net of 7 black candles.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
An on-neck line occurred. This is a bearish pattern where prices should move lower when the white candlestick’s (i.e., the most recent) low is penetrated.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 68.2867. This is not an overbought or oversold reading. The last signal was a sell 0 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 59.53. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 1 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 64. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 7 period(s) ago.
Rex Takasugi – TD Profile
WALT DISNEY CO closed down -0.960 at 106.100. Volume was 28% above average (neutral) and Bollinger Bands were 63% wider than normal.
Open High Low Close Volume___
105.990 106.980 105.760 106.100 2,809,246
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 105.41 102.04 103.26
Volatility: 23 21 24
Volume: 2,918,906 2,308,598 2,351,497
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
WALT DISNEY CO is currently 2.8% above its 200-period moving average and is in an upward trend. Volatility is Our volume indicators reflect volume flowing into and out of DIS.N at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on DIS.N and have had this outlook for the last 6 periods.
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