Walt Disney (New York Stock Exchange: DIS) is making every effort to improve its performance under the leadership of CEO Robert Iger. The company’s cost-cutting and other initiatives bode well for the company’s future growth. As a result of these efforts, hedge fund managers have increased their holdings of DIS shares.
TipRanks’ Hedge Fund Trading Activity tool shows that hedge funds bought 2.9 million shares of DIS in the last quarter. Purchasers include Ken Fisher of Fisher Asset Management LLC and Joel Greenblatt of Gotham Asset Management LLC. Overall, Disney currently has very positive hedge fund confidence signals.
Disney’s recent developments
In its annual filing, the company said Eiger would make “organizational and operational changes.” Iger will focus on delivering content through direct-to-consumer (DTC) streaming services rather than traditional sources. Additionally, Disney plans to release about 20 films in fiscal 2023. This should revive the movie business, which has particularly fallen back during the pandemic.
The company last month launched affordable, ad-supported Disney+ subscription plans to boost subscriber growth. What’s more, Disney’s parks division continues to do well after the company raised prices for some of its parks in 2022.
In terms of valuation, the stock appears to be undervalued. The current price/sales ratio is trading at 1.92x, a 44.1% discount from the sector median of 3.42. This is a great buying opportunity for investors.
Is DIS a good stock to buy?
At TipRanks, the DIS stock has a strong buy consensus rating based on 17 buys and 4 holds. An average Disney stock price target of $120.76 implies a 39% upside potential.
In addition, insiders have also purchased $2.5 million worth of Disney stock in the past three months. Overall, DIS scored him an 8 out of 10 on his TipRanks Smart Score rating system, indicating he has the potential to perform well.