Walt Disney Co. (NYSE: DIS) may be on track for sustained earnings growth in the coming years, according to a bullish note from Morgan Stanley.
Analyst Benjamin Swinburne reaffirmed the firm’s overweight rating on the stock while raising the price target to $140 per share from $120—implying a potential upside of roughly 20% from Friday’s closing price.
Disney shares have climbed about 5% so far in 2025. Morgan Stanley’s updated valuation comes just ahead of the entertainment giant’s fiscal third-quarter earnings release, scheduled for Wednesday before the market opens.
Strong macro trends could fuel double-digit EPS growth
Swinburne highlighted that Disney’s outlook is tightly linked to broader economic conditions.
“If the macro backdrop remains healthy, we see Disney generating healthy double-digit adjusted EPS growth in the years ahead,” he wrote in the report.
Morgan Stanley’s projections suggest that Disney is on course to rebuild—and potentially exceed—its pre-pandemic earnings levels by fiscal year 2027.
That optimism is driven largely by momentum in Disney’s Experiences segment, which includes its theme parks and resorts, and its evolving streaming business.
According to Swinburne, the recovery in consumer travel and discretionary spending, coupled with ongoing engagement in Disney’s parks and entertainment venues, is helping the company reestablish a stable and growing earnings base.
Streaming drives the post-pandemic pivot
A central theme of the report is Disney’s transition from traditional media models to direct-to-consumer (DTC) platforms.
Swinburne noted that the company has effectively “made the pivot” in its media earnings base, with growth in streaming and content sales now more than offsetting headwinds in its legacy businesses.
“Growth in streaming (DTC) and content sales (CS & L) now more than offset a flattish ESPN (Sports) and declining Linear Entertainment segment,” he said.
The statement reflects the broader trend of cord-cutting and shifting consumer habits, which have placed pressure on cable-based networks but created opportunities in digital distribution.
This transformation, according to Swinburne, is nearing completion, with Disney’s streaming platforms—including Disney+, Hulu, and ESPN+—now positioned as meaningful contributors to the company’s profitability.
Experiences segment anchors the rebuild
Beyond streaming, Morgan Stanley emphasized the resurgence of Disney’s Experiences division as a key growth driver.
Swinburne credited strong performance in the segment for supporting Disney’s post-pandemic earnings rebuild.
“Following its pivot to streaming, the impact of the pandemic, and continued cord-cutting, Disney has been rebuilding its earnings base, a project nearly complete thanks to strong Experiences growth and the emergence of streaming as a profit center,” he said.
As Disney prepares to report earnings this week, analysts and investors alike will be watching for confirmation of these trends.
Positive results in Experiences and continued subscriber growth in streaming could bolster confidence in Morgan Stanley’s forecast—and potentially push Disney closer to its $140 target.
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