The Walt Disney Company (NYSE:DIS) new streaming offering is likely to be the key driver
Today is historic for Disney (NYSE:DIS) stock, as the company closed its $71 billion acquisitionof assets of Twenty-First Century Fox (NASDAQ:FOX).
For Disney CEO Robert Iger, the deal had its challenges. Keep in mind that Disney’s rival, Comcast, (NASDAQ:CMCSA) tried to buy the Fox assets. But Iger got aggressive, boosting the price that DIS was willing to pay by about $19 billion.
But I think it was a good move, and the deal is likely to spark meaningful increases in the DIS stock price. The transaction brought marquee assets to DIS, like major film franchises (Avatar and Marvel’s X-Men), TV shows (Empire, Modern Family, American Horror Story: Roanoke and American Dad) and cartoons (Ice Age and Rio).
Yet there are certainly more reasons to be bullish about DIS stock than just the FOX deal.
So let’s take a look at three reasons to be bullish about Disney stock.
Reason to Be Bullish on Disney Stock: Diverse Assets
As seen with companies like GE (NYSE:GE), it’s tough to run disparate businesses. But this has not been an issue for Disney. The company’s diverse assets all are well-managed and seamless.
The conglomerate’s Parks and Consumer Products segment continues to grow at a nice pace. Keep in mind that the unit has been able to raise its prices, a testament to the power of the company’s premium brand and a positive catalyst for Disney stock price. And the company continues to launch new parks, such as those focused on Star Wars.
Then there is Disney’s studio business. Last quarter, the company’s movie unit slipped, as some films, such as Mary Poppins Returns and The Nutcracker and the Four Realms, performed badly at the box office.
But in 2019, Disney’s strong slate of movies should be a positive catalyst for Disney stock. Some of the company’s upcoming films are Dumbo, Aladdin, Star Wars: Episode 9, Frozen 2 and Avengers: Endgame. It’s pretty reasonable to assume that some of these flicks will be mega hits.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 112.76.
The projected lower bound is: 107.20.
The projected closing price is: 109.98.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).
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 17.2049. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 9 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 36.57. 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 buy 57 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 -266.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 16 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 sell 5 period(s) ago.
Rex Takasugi – TD Profile
WALT DISNEY CO closed down -0.010 at 109.990. Volume was 247% above average (trending) and Bollinger Bands were 29% narrower than normal.
Open High Low Close Volume___
110.250 110.880 108.050 109.990 8,343,253
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 113.39 112.31 111.61
Volatility: 19 16 24
Volume: 5,453,716 2,516,188 2,155,082
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 1.5% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of DIS.N (mildly bearish). Our trend forecasting oscillators are currently bearish on DIS.N and have had this outlook for the last 0 periods.