Disney Surges on Good News, ESPN

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Los Angeles -- Walt Disney Co.'s stock surged into
record territory last Thursday after a solid earnings report, announcement of a
three-for-one stock split and bullish analyst reports.

Several analysts raised their stock target prices -- at
least two pegged Disney at $140 on a pre-split basis -- partly because Disney executives
said upcoming animated movies would drive earnings growth. Disney also pointed to
stronger-than-expected results at theme parks, and said continued strong advertising
growth at ESPN overcame weakness at the ABC broadcast network. Even ABC could turn up next
year, one analyst said.

In the second quarter, ended March 31, net income rose 22
percent, to $384 million, and diluted earnings per share increased 20 percent, to 55
cents, ahead of most forecasts. Revenue was flat in the quarter.

Disney highlighted its theme parks and resorts unit, where
revenue rose 3 percent and operating income rose 15 percent, despite start-up costs for
the new Animal Kingdom in Orlando, Fla., and the Disney Cruise Line.

ESPN growth drove a 4-percent revenue gain in Disney's
broadcasting division.