Disney Q4 Earnings: Company Hauls In 'Pirates' Treasure

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Disney's Profit Soars on Success of `Pirates' Film [Bloomberg]

Summary: Walt Disney reported stunning Q4 earnings after yesterday's market close. Net income reached $782 million, or 36 cents/share, double last year's $379 million, or 19 cents/share. Disney shares initially fell 73 cents to $32.85 in extended trading, then rose 48 cents, or 1.5 percent, to a five-year high of $33.58. Analysts pin these dramatic returns on both the film division's successes with "Pirates of the Caribbean: Dead Man's Chest" and "Cars" in addition to the CEO Robert Iger's decision to move Monday Night Football from ABC to ESPN. Disney spent $225 million on "Pirates" and the movie has grossed $1.06 billion. The Monday Night Football move resulted in soaring cable ratings and significantly helped the media unit reap $883 million in profit. Analysts are pleased with these results but expressed come concern about theme park profitability, given the recent weakness in consumer spending.
Related links: Earnings conference call transcript: Walt Disney Company F4Q06 . Disney press releases: Disney Reports FY 2006 Earnings. Additional earnings coverage: The Street.com • WSJ. Commentary: Web Video Market: Who Will Win The Big Ad Money? • Disney Offering Free TV Programing at ABC.com.
Potentially impacted stocks and ETFs: Walt Disney Company (DIS) • Competitors: CBS Corp. (CBS), News Corp. (NWS), Time Warner Inc. (TWX) • ETFs: Vanguard Consumer Discretionary VIPERs (VCR), PowerShares Dynamic Large Cap Growth (PWB), iShares Dow Jones US Consumer Services (IYC) all have DIS as a top-ten holding.

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