Earlier today, we heard about the NFL’s potential plan to acquire a stake in ESPN, which is owned by media company Disney (NYSE:DIS). Analysts were impressed by the notion, and investors weren’t unhappy about the idea either. Indeed, Wells Fargo, via analyst Steven Cahall, pronounced it a pretty good plan, noting that the idea of the NFL taking an equity stake in ESPN was the “only upside” for any attempt at stabilizing ESPN.
With the NFL stepping in, ESPN would get control of NFL Media, which includes NFL Films, RedZone, and the NFL Network entirely. Cahall also noted that should the plan go through, the NFL would basically keep ESPN afloat for the next decade as a “key transition partner.” With the NFL’s rights representing one of the richest purses in sports broadcasting, it’s a huge deal for ESPN, should it happen.
Where Could It Go from There?
The idea that the NFL could take an equity stake in ESPN isn’t exactly surprising; the NFL has a vested interest in ensuring its games reach the widest range of viewers, and having a hand in ESPN would be a way to do that. But could ESPN offer a similar deal to the other sports? Clearly, the NFL is only a vague competitor to the NBA. Back in 2020, the NBA started reconsidering its schedule to ensure minimal conflict with NBA games. And certainly, Major League Baseball has little to fear from the NFL, except possibly toward the end. This deal works pretty well for ESPN, so why not branch it out from there? It’s a win for ESPN, a win for Disney by extension, and quite possibly, a win for all the other sports as well.
Is Disney Stock a Buy or a Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on DIS stock based on 16 Buys and five Holds assigned in the past three months, as indicated by the graphic below. After a 7.99% loss in its share price over the past year, the average DIS price target of $107.89 per share implies 17.5% upside potential.
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