Earnings Preview: The Walt Disney Company

The Walt Disney Company (DIS) is expected to report Q3 earnings after market close Wednesday, July 30, with a conference call scheduled for 4:30 p.m. ET.

Guidance

Analysts are looking for a profit of 61c on revenue of $9.13B. The consensus range is 54c to 65c for EPS, and revenue of $8.73B to $9.57BB, according to First Call. Between soaring food and gas prices, limited credit and worries about jobs, consumers cut back spending on discretionary items.

Analyst Views

Disney, which owns theme parks, movie studios, ABC television, ESPN, and radio stations, could be protected from a downturn from these diverse properties, Michael Yoshikami, president and chief strategist at YCMNET Advisors said. One positive sign for Disney is evidence that this has been a good summer for movie attendance, he said, although more people going to the the movies might be a sign that fewer Americans are traveling on long vacations, which may hurt Disney's theme-park business.

Caris, too, has concerns about the short-term outlook for Disney's domestic theme parks, but believes the company is benefiting from outstanding fundamentals and strong brand positioning at its Media Networks unit. Disney officials have said that its theme parks and resorts are maintaining bookings because they are priced competitively.

Earlier this month, Lehman Brothers downgraded the entire entertainment sector due to concerns that Internet distribution could hurt media companies' traditional revenue streams. The analyst also cited a possible slowdown at Disney's parks and resorts as a basis for his downgrade to Underweight from Equal Weight. Investors and analysts will listen for management's comments on the 2009 outlook for its theme parks, as well as to what extent it has been affected by airlines cutting capacity to nearby Orlando International Airport.