Shares of Disney (DIS) are lower today as the media giant scrambles to renew its distribution deal with satellite TV provider DirecTV before it expires this Sunday, according to Reuters. If they don’t reach an agreement, over 11 million DirecTV subscribers could lose access to Disney channels like ABC and ESPN, just as the NFL season kicks off and the U.S. Open tennis tournament heats up. The problem is that DirecTV wants to offer smaller and cheaper packages without ESPN for customers who aren’t into sports, while Disney is pushing for a sports-focused bundle combining ESPN and ABC.
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These negotiations come at a time when traditional cable and satellite TV providers are losing subscribers to streaming services. DirecTV is trying to adapt to this reality by trying to make its offerings better match consumer preferences. On the other hand, Disney has been making moves to keep its content accessible by striking deals like the one with Charter Communications (CHTR) to distribute its streaming services alongside its traditional channels.
Is Disney Stock a Buy or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on Disney stock based on 19 Buys, four Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After an 8% rally in its share price over the past year, the average DIS price target of $118.53 per share implies 32% upside potential.
