Stocks slip despite EU trade deal — plus, the 2 questions we want tech earnings to answer
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CNBC
2 minutes ago
- CNBC
Disney earnings are coming Wednesday. Here's what top analysts expect
Walt Disney is on the docket to release fiscal third-quarter results before the stock market's opening bell Wednesday, and most analysts expect the entertainment giant to once again beat Street expectations. An LSEG survey shows analysts, on average, estimate that Disney will earn $1.47 per share on $23.73 billion in revenue. Those results would correspond to earnings growth of 1.5% year over year, as well as a 2.5% rise in revenue when compared to the year-earlier period. The low-single-digit growth comes after Disney's fiscal second-quarter earnings and revenue beat analyst expectations, boosted by better-than-anticipated subscriber growth for the Disney+ streaming platform. In the March quarter, Disney saw revenue growth in all three of its business segments — entertainment, sports and experiences — and selectively raised some of its fiscal 2025 guidance. Since the start of 2025, shares of Disney have gained almost 7%, trailing the S & P 500 by a hair. DIS YTD mountain DIS YTD chart Heading into June quarter earnings, most of Wall Street is bullish on Disney, with some analysts pointing to potential catalysts in Disney's parks and experiences segment. LSEG data shows that 28 analysts covering the stock rate it a strong buy or buy, while five give it a hold and one rates it underperform. Here's what analysts at some of Wall Street's biggest banks are saying before Disney's latest earnings report. UBS: Buy rating, $138 price target UBS recently raised its price target to $138 from $120, implying upside of nearly 16% from Disney's Monday close. "We expect F3Q results to highlight resilient demand at the Parks and similar improvement in [direct-to-consumer] profitability, supporting a continuation of double digit earnings growth. We're looking for revenues of $23.3B and segment [operating income] of $4.75B, up 1 and 12% y/y. We expect Disney to generate EPS of $1.59 in F3Q (+13% y/y) and $5.89 for the year, or 17% growth vs. guidance/Street at 16%. We remain constructive on the outlook for F26 given underlying trends at the parks, new cruise capacity, strong content pipeline and inflecting margins in DTC with upside from full control of Hulu." JPMorgan: Overweight, $138 JPMorgan recently increased its price forecast to $138 per share from $130. "We're updating Disney estimates ahead of F3Q earnings. For the quarter, we raise our segment operating income 1% to $4.56b on the shift of some Linear Networks expenses in F4Q; for the year, our [segment operating income] reduces marginally to $17.8b (+14%) on lower [content sales and licensing] contribution. Our EPS is now $1.46 for F3Q and $5.80 for F25 … From a financial perspective, we're comfortable with our F25 EPS at $0.05 above guidance, and see room for a modest increase to the outlook driven by multiple segments." Wolfe Research: Outperform, $139 The firm's price target, recently raised from $120, is roughly 16% above Disney's current price. "We raise revenue to $23.6B (prev. $23.3B) reflecting less bad advertising declines at linear networks, which we previously modeled to bake in a macro-slowdown, along with better results at Content/Licensing primarily driven by Lilo and Stitch. We keep Experiences revenue of $8.9B unchanged reflecting intra-quarter management commentary that trends at the parks remain positive … We model $1.52 of EPS (prev. $1.50) on better operating results." Morgan Stanley: Overweight, $140 Analyst Bejamin Swinburne's new price target of $140 , raised from $120, implies upside of 17% ahead. "If the macro backdrop remains healthy, we see Disney generating healthy double digit adj. EPS growth in the years ahead. Thanks to growth in its Experiences and Streaming businesses, it is poised to have rebuilt its pre-pandemic earnings base and hit new heights by FY27." Citigroup: Buy, $140 The bank raised its target price to $140 per share from $125 in early July. "Consensus estimates call for fiscal 3Q25 segment operating income of $4.55 billion, EPS of $1.48, and 1.4 million Disney+ net additions. We expect Disney to report EBIT relatively in-line with the Street, EPS modestly below consensus, and Disney+ subs slightly ahead of consensus … We expect management to reiterate components [in] its FY 2025 outlook." Bank of America: Buy, $140 "Exiting last quarter, DIS raised FY25 EPS guidance to $5.75 following a strong earnings beat. We believe this increased guidance is highly achievable as DIS was reporting earnings around the peak of uncertainty related to tariffs which limited visibility. Moreover, while DTC is expected to be an investment year, we believe there will be some discretion around the magnitude of spend, and momentum thus far in the parks (a key concern heading into the year) should be positive for underlying fundamentals." Rosenblatt: Buy, $140 "At Disney, core parks are benefiting from launches of new cruise ships, and should also benefit from the pending launch of the new fulsome-priced ESPN streaming service, helping support a historically premium valuation relative to growth … Overall, we have confidence that Disney can fare somewhat better than its guide for 16% Y/Y growth in adj. EPS to $5.75 (we model $5.93) in F2025. Our $1.63 estimate for F3Q25 is 12% above consensus." MoffettNathanson: Buy, $140 "We are increasing our F3Q 2025 forecasts driven by higher Entertainment revenue (+1%) and EBIT (+9%) estimates, primarily to reflect the stronger-than-anticipated box office performance of Lilo & Stitch plus continued improving DTC profitability … Relative to consensus, we remain slightly behind on our FY 2025 revenue forecast but ahead on EBIT as we believe Disney will exhibit stronger expense control. For FY 2026, however, we are -2% below consensus on revenue and -1% below on EBIT, culminating in a -3% EPS lower forecast. We continue to take a more conservative approach to the impact Epic Universe could pose for FY 2026 (vs. FY 2025) for Walt Disney World, as well as attempting to factor in the macro uncertainty from higher tariffs." Jefferies: Buy, $144 In June, Jefferies analyst Ed Alter upgraded shares of Disney to buy from hold and raised his price target to $144 per share from $100, implying nearly 21% upside from Monday's close. "We upgrade DIS to Buy for 4 primary reasons: 1) Now see limited risk of a 2H25 Parks slowdown from Epic Universe/Macro. 2) More positive on FY26 Cruise upside, JEFe $1B+ rev uplift. 3) Continued DTC margin expansion (0% FY24 to 13%+ by FY28E). 4) View next 6 months content & sports slate favorably, including ESPN DTC launch, Zootopia 2 and Avatar 3. DIS has failed to grow Op. Inc FY16-FY24, but we believe this dynamic is set to change."
CNBC
2 minutes ago
- CNBC
S&P 500 struggles to make it two wins in row — plus, a portfolio name leads the M&A race
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Market moves : Wall Street on Tuesday was having a hard time keeping Monday's rally going. The S & P 500 spent much of the afternoon in the red, one day after making back much of Friday's 1.6% drop. Weak jobs data was the reason for Friday's decline, but also the reason behind the near 90% market odds of a Federal Reserve interest rate cut in September. During Tuesday morning's CNBC interview, President Donald Trump was asked about the jobs numbers, and he stood by his assertion that the jobs numbers were rigged to make him look bad. Trump also said pharma tariffs could go up to 250% and that semiconductor levies could come as soon as next week . The president also said four people are being considered for Fed chair. He said, "Both Kevins are very good," referring to speculation about former Fed Governor Kevin Warsh and Kevin Hassett, the current National Economic Council director and a key Trump advisor. "There are other people that are very good, too," Trump said, adding, however, that Treasury Secretary Scott Bessent does not want the Fed job. M & A ranking : Goldman Sachs was No. 1 in mergers and acquisitions (M & A) so far in 2025, according to new LSEG data. For the first seven months of the year, the Club holding was the top global M & A financial advisor by both number and value of deals. Morgan Stanley and JPMorgan followed. Combined M & A value for Goldman jumped 54% year to date over the same time frame in 2024. The Wall Street powerhouse grabbed 32% of market share, according to LSEG. There were significant improvements for fellow Club name Wells Fargo , too. The bank jumped to seventh place in this year's M & A rankings, up from 16th last year. The influx of deals for Goldman and Wells is a part of a broader M & A pickup. Global M & A reached $2.36 trillion during the first seven months of the year, a 35% increase from the year prior, according to LSEG. While the overall price tag of the deals went up, the number of actual deals announced over the seven-month period hit a five-year low. So, fewer deals but much bigger swings. There have been five high-profile M & A transactions, worth at least $10 billion or more, announced in July alone. They include last week's announcement of Union Pacific 's proposed merger with rival Norfolk Southern for $85 billion. Wells Fargo is an advisor on the deal. Goldman was tapped to help Baker Hughes buy Chart Industries for $13.6 billion, according to a July 29 company announcement. Overall, the rebound in Wall Street dealmaking is great news for Goldman Sachs because investment banking is a crucial business for the firm. It's also a key reason why the Club first started a position earlier this year. Additionally, Wells Fargo moving up in the M & A ranks is a sign that management's expansion into investment banking is paying off. Although Wells is known as a Main Street lender, we like that the firm is diversifying its revenue streams to not rely so heavily on interest-based income streams. Now that the 2018 Federal Reserve-imposed $1.95 trillion asset cap has been removed, Wells Fargo can grow its nascent IB business and others, even further. Tariff update : Honeywell CEO Vimal Kapur told CNBC Tuesday that the impact of the next wave of tariffs remains unknown. But roughly five weeks into the third quarter, Kapur said he has not seen any tariff impact that would change the earnings-per-share (EPS) outlook that the company issued nearly two weeks ago as part of its second quarter financials. Management raised Honeywell's full-year outlook for revenue , organic sales growth, and adjusted EPS during earnings on July 24. Since then, however, President Donald Trump signed an executive order that updated import duties between 10% to 41% for dozens of countries, which are set to go into effect in two days. Kapur said trade policy updates are "a new factor that's coming in," but that "so far we haven't seen any impact" beyond the scope mentioned on the post-earnings call. "That's why we remain confident of the earnings guide that we gave," he added. Kapur's remarks come ahead of Honeywell's spinoff into three standalone entities — a process expected to be completed by the end of 2026. Automation will stay with the current Honeywell, and aerospace and advanced materials will be split off. The CEO said the "spinoffs are progressing on time" as well. This is reassuring news for investors like us. That's because for over a year, Jim has insisted that Honeywell needs to dramatically reshape its portfolio of far-flung businesses. Not only did Honeywell's organic revenue growth continue to disappoint Wall Street in recent years, but its shares have lagged compared to peers as well. We think this will change once Honeywell's break-up is finished, as the Street starts to see the quality fundamentals in each standalone company. That being said, don't expect many more significant portfolio moves from Honeywell. "We have majorly completed our portfolio transformation work," Kapur said. Up next : After covering Coterra , Eaton , and DuPont earnings Tuesday (we also bought some more DuPont), Club name Disney reports its quarter before Wednesday's open. Parks and streaming are two keys items to watch, especially following the Athletic report that the NFL will provide ESPN with many of the league's media assets in exchange for equity in the sports network. Eli Lilly and Texas Roadhouse , also positions in the portfolio, are out with earnings before Thursday's open and after the close, respectively. (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
CNBC
2 minutes ago
- CNBC
Prediction markets see Hassett and Warsh as Fed chair frontrunners as Trump talks up the "Kevins"
President Donald Trump's fresh comments on potential candidates to replace Jerome Powell as the next chair of the Federal Reserve sparked a wave of speculation on prediction markets. National Economic Council Director Kevin Hassett, former Fed Governor Kevin Warsh, current Fed Governor Christopher Waller and Treasury Secretary Scott Bessent had all been floated as contenders to lead the central bank. In a wide-ranging interview on CNBC's "Squawk Box," Trump spoke highly of Hassett and Warsh, while revealing that Bessent, enjoying his current post as Treasury Secretary, has taken himself out of contention. "He's very good," Trump said, referring to Walsh. "Sometimes they're all very good, until you put them in there, and then they don't do so good. But ... I think he's a very good guy. I'd say Kevin and Kevin, both Kevins are very good." Wagers on prediction market Kalshi moved quickly after Trump's comment, assigning Hassett and Warsh a 35% chance each of being named the next Fed chair. Waller, whom Trump didn't mention in the interview, has a 15% probability of being his pick and his odds decreased somewhat following the interview. Both Hassett and Warsh have advocated for lower interest rates. Current Chair Powell, whose term ends in May 2026, has been a frequent target of Trump's criticism for keeping rates elevated. Fed Governor Adriana Kugler announced Friday she is resigning effective this week, which Trump said "was a pleasant surprise." The move allows Trump to install someone to the Fed Board of Governors, and the nominee could move into the chairman role when Powell's term expires. Judy Shelton, former economic advisor to Trump in his first term, was assigned a 6% chance to be Powell's replacement on Kalshi. David Malpass, former government official who served as President of the World Bank Group from 2019 to 2023, currently has a 4% probability on the prediction market. Trump himself even received a 1% vote to lead the Fed on Kalshi.
