Disney Puts the “Magical Express” into Retirement

Disney announced on Monday that it would be making some changes to the offerings it provides guests, specifically on how people visiting the park travel around.

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Disney (DIS) informed vacationers on its Blog page on Monday that it will be cancelling the Disney “Magical Express” service, starting from January 1, 2022. The “Magical Express” is a free shuttle service that transports guests staying at Walt Disney World hotels to and from Orlando International Airport.

The move comes after Disney analyzed trends across the travel industry, and concluded that times have changed, and people now have multiple options to get around faster and at their own convenience.

Disney Resort hotel guests will still have access to complimentary transportation options within the Disney World Resort, such as buses, monorails and the Disney Skyliner, to and from all four theme parks.

Disney was quick to reassure guests that although the “Magical Express” will soon be retired, guests can look forward to some new offerings and attractions that will enhance their Disney World experience, including the Park Hopper Option, which allows guests to visit more than one park per day. (See DIS stock analysis on TipRanks)

JPMorgan analyst Alexia Quadrani reiterated her Buy rating on DIS shares yesterday and raised her price target from $175 to $210. This implies upside potential of around 17% from current levels.

Quadrani believes the profitability timeline appears conservative as her models suggest that Disney+ will breakeven in 2023 versus the consensus estimate of 2024, and believes Disney’s direct-to-consumer businesses deserve a multiple in-line with that of Netflix.

Consensus among analysts is a Strong Buy based on 17 Buys and 5 Holds. The average price target of $184.33 suggests upside potential of around 3% over the next 12 months.