Jefferies Upgrades Disney to Buy, Sets $144 Price Target

Disney streaming revenue and theme park growth drive analyst confidence in entertainment giant’s profitability targets

Key Takeaways

• Jefferies upgrades Disney to “buy” with $144 target price — 19% upside from previous closing price of $121.46, citing limited park segment risks and strong streaming margins expansion
• Disney streaming margins projected to surge from 0% to 13% — Direct-to-consumer segment expected to drive significant profitability gains through 2028
• EU leaders approve €500 billion green investment plan — Comprehensive fiscal strategy includes tax reforms and SME support to strengthen European economic resilience

Introduction

Disney shares surge near 52-week highs following a major upgrade from Jefferies, which raised its rating from “hold” to “buy” with a significantly increased price target of $144. The entertainment giant’s stock currently trades at $122.34, reflecting strong momentum with nearly 25% returns over the past year.

The upgrade signals renewed confidence in Disney’s strategic execution across its restructured business divisions. Jefferies analysts cite multiple growth catalysts, including resilient theme park performance and accelerating streaming profitability.

Key Developments

Jefferies raised Disney’s price target from $100 to $144, representing approximately 20 times the projected fiscal year 2027 price-to-earnings ratio. The research firm outlined four primary reasons for the upgrade, focusing on the company’s operational realignment and revenue diversification.

Disney has restructured into three core divisions — Entertainment, ESPN, and Parks — to improve accountability and capital allocation. This organizational shift coincides with major intellectual property releases including Zootopia 2 and Avatar 3, expected to boost theatrical and licensing revenues.

The company’s acquisition of the remaining 33% stake in Hulu from NBC Universal for $438.7 million is set to complete by July 2025. This move supports Disney’s strategy to integrate streaming services more effectively across its direct-to-consumer platform.

Market Impact

Disney stock demonstrates strong technical momentum, trading near its 52-week high of $122.94. Multiple analysts have increased price targets, with Rosenblatt setting a $140 target while maintaining a Buy rating.

Bernstein adjusted its price target to $125, highlighting expected earnings growth despite market complexities. The stock benefits from InvestingPro data showing a “GREAT” financial health score, supported by robust revenue of $94.04 billion and EBITDA of $19.12 billion over the past twelve months.

Strategic Insights

Disney’s direct-to-consumer transformation represents the most significant structural shift driving analyst optimism. The streaming business is projected to expand margins from 0% in fiscal 2024 to over 13% by 2028, creating substantial profitability growth.

The parks and experiences segment faces competitive pressure from Universal’s Epic Universe opening, yet analysts express limited concern about second-half 2025 performance. Disney’s cruise business expansion, with two new ships arriving in early 2026, is forecast to generate over $1 billion in additional annual revenue.

ESPN’s strategic evolution toward standalone streaming services positions Disney to capitalize on evolving consumer preferences. The sports network’s partnership with Premier Lacrosse League, including media rights and minority stake acquisition, demonstrates the division’s content expansion strategy.

Expert Opinions and Data

Jefferies analysts emphasize reduced economic slowdown concerns, noting that Disney has struggled to grow operating profit from 2016 to 2024. “This dynamic is set to change with an optimistic outlook,” according to the research firm, which projects 11% adjusted earnings growth in fiscal 2027.

Updated Disney World booking data supports management commentary on park growth, showing forward growth of 4% in fiscal third quarter and 7% in fiscal fourth quarter. These metrics indicate sustained consumer demand despite macroeconomic headwinds.

Meanwhile, European leaders reached agreement on comprehensive fiscal policies during the recent Brussels economic summit. Yahoo Finance reports the agreement includes €500 billion in green technology investments and enhanced SME financing access.

Conclusion

Disney’s multi-faceted transformation across streaming, parks, and sports media creates multiple revenue growth vectors that analysts increasingly recognize. The company’s operational restructuring addresses previous profitability challenges while positioning for sustained margin expansion.

The convergence of analyst upgrades, strong booking trends, and strategic acquisitions reinforces Disney’s position as entertainment industry consolidation continues. Current market positioning near 52-week highs reflects growing institutional confidence in the company’s execution capabilities across its diversified business portfolio.