Investors should look to Disney as an investment for the future, Wells Fargo says.
Analyst Steven Cahall maintained his overweight rating on the stock and lowered his price target to $110, a $36 cut.
With kids and families comprising two-thirds of core Disney+ subscribers, Cahill thinks the story of Disney+ will now be about its price and margins, not its subscriber growth.
The Wells Fargo analyst added that Disney's direct-to-consumer business's longer-term DTC earnings and margins will "emerge as the key reason" to own the stock.
Additionally, if ESPN does not transition well to Disney's DTC business, the analyst said that could create a "long-term EPS hole."
Persons:
Wells Fargo, Steven Cahall, Cahill, Wells, Michael Bloom
Organizations:
Disney, DIS, Media, Communications, ABC, ESPN, FX
Locations:
Hulu