News that Barclays analyst Kannan Venkateshwar downgraded Walt Disney Co. from Overweight to Equal-Weight with a price target of $175, down from $210, caught many investors by surprise and caused the stock to sink by 3 percent in Monday’s trading.
What Happened
Venkateshwar said this downgrade was justified based on a perceived slowing of the subscription level of the Disney+ streaming service, claiming the company has fallen behind its goal of reaching 150 million Disney+ subscribers by 2024. Disney CEO Bob Chapek stated last month the fourth-quarter global paid subscribers for Disney+ is forecast to by “low single digit” millions, down from a 58.5 million increase in the previous quarter.“While the company appears to be targeting one new piece of content a week, not every piece of content has the same franchise value or visibility,” Venkateshwar said in the note.
