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Walt Disney Company (NYSE:DIS) stock is on track to close in red for the seventh consecutive trading session as media companies gear up for California’s tighter subscription law.
On July 1, California implemented certain changes to its Automatic Renewal Law regarding companies that offer customers subscriptions or services that require automatic renewal.
The state already has some of the strictest requirements for automatic renewals in the country, and the new changes add further layers to the legislation and can have sweeping implications for businesses.
These changes would no doubt directly have an effect on companies offering subscription services, such as the Burbank, CA-based streaming giant Disney (NYSE:DIS).
DIS has lost 3.16% over the course of the last six trading days in the wake of the news. The stock was 2.31% down at $116.36 on Friday afternoon.
Despite the regulatory burden, the stock remains a Buy, according to the Wall Street community as well as Seeking Alpha authors.
“I found myself impressed with the overall performance of the business, especially the streaming side of the business and its theme parks. Long term, I think that its success will continue to fuel shareholder growth,” noted Seeking Alpha contributor Daniel Jones.
Walt Disney Company once again topped the list of global licensors in 2024, keeping its lead intact with an estimated $62B in retail sales of licensed products.
However, Seeking Alpha’s Quant Rating system sees the stock as Hold.
The data-driven quantitative measuring system assigns DIS a score of 3.48 on a scale of 5, with a D for Valuation, C- for Growth, A+ for Profitability, B+ for Momentum, and A- for Revisions.
The stock has gained ~4% year-to-date, and is trading about 8% above its 200-day simple moving average.
Walt Disney Company is scheduled to report its fiscal third quarter earnings results on August 6, before market open.
The consensus EPS estimate stands at $1.45 (+4.00%Y/Y) and the consensus revenue estimate at $23.76B (+2.61% Y/Y).
Short interest on the stock stood at 1.21% of the total float as of July 24.