- If you are wondering whether Walt Disney stock is priced attractively or already reflecting its strengths, starting with a clear view of value can help you frame every other headline you read.
- The stock last closed at US$103.00, with a small gain of 0.3% over the past week, while being down 1.7% over 30 days, down 7.9% year to date, down 5.1% over 1 year, up 19.4% over 3 years and down 41.0% over 5 years. This gives a mixed picture of how the market has been reassessing the company over different timeframes.
- Recent coverage around Disney has focused on broad themes such as its role as a major media and entertainment company and how investors are weighing its various business segments against the current share price. These stories provide important context for the recent price moves, because they influence how the market interprets both risks and opportunities around the stock.
- On Simply Wall St’s valuation checks, Disney scores 5 out of 6 for being assessed as undervalued, giving it a valuation score of 5. The next sections will walk through the key valuation approaches used to reach that view, before finishing with a framework that can help you interpret these valuation tools more effectively.
Approach 1: Walt Disney Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model estimates what a stock could be worth by projecting the company’s future cash flows and then discounting those back to today’s value using a required rate of return.
For Walt Disney, Simply Wall St uses a 2 Stage Free Cash Flow to Equity model built on cash flow projections. The latest twelve month Free Cash Flow is about $8.53b. Analyst inputs and subsequent extrapolations point to projected Free Cash Flow of $15.55b in 2035, with interim projections such as $10.21b in 2026 and $14.15b in 2030. Figures beyond the typical analyst horizon are extrapolated by Simply Wall St, rather than based on explicit analyst estimates.
Bringing all those projected cash flows back to today, the model arrives at an intrinsic value estimate of about $109.57 per share. Compared with the recent share price of $103.00, the DCF implies the stock trades at a discount of around 6.0%, which is a relatively small gap.
Result: ABOUT RIGHT
Walt Disney is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act.
Approach 2: Walt Disney Price vs Earnings
For profitable companies, the P/E ratio is a useful way to think about what you are paying for each dollar of earnings, because it ties the share price directly to the current profit base.
What counts as a “normal” P/E depends on how the market views growth potential and risk. Higher expected growth or lower perceived risk can support a higher multiple, while slower growth or higher risk tends to go with a lower one.
Walt Disney currently trades on a P/E of about 15.94x. That sits below the Entertainment industry average P/E of 30.95x, and also below the peer group average of 50.59x, so the stock trades on a lower multiple than many listed comparables.
Simply Wall St’s Fair Ratio for Walt Disney is 24.58x. This is a proprietary estimate of what a “reasonable” P/E might be for this specific company, given factors such as its earnings growth profile, profit margins, market capitalization, risk indicators and the characteristics of its industry. Because it is tailored to the company rather than just using broad peer or industry averages, the Fair Ratio can give a more targeted sense of where the multiple could sit.
Comparing the Fair Ratio of 24.58x with the current P/E of 15.94x suggests the stock trades below that company specific reference point.
Result: UNDERVALUED
P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 20 top founder-led companies.
Upgrade Your Decision Making: Choose your Walt Disney Narrative
Earlier we mentioned that there is an even better way to understand valuation. This is where Narratives come in, giving you a simple way to tell the story behind your numbers by tying your view of Walt Disney’s future revenue, earnings and margins to a forecast and then to a Fair Value that you can compare with today’s price.
On Simply Wall St’s Community page, Narratives are used by millions of investors as an accessible tool. They let you set your own assumptions, see a Fair Value come out of that story, and then decide whether the current share price looks high or low relative to your view, with the model updating automatically when fresh information such as earnings or news is added.
For Walt Disney, one investor might build a Narrative that emphasizes more cautious growth, higher content and park costs and a lower profit margin, arriving at a Fair Value close to about US$96 per share. Another might focus on expanding experiences, steadier margins and higher earnings and land closer to about US$165 per share. This shows how different stories about the same company translate into very different valuations that you can weigh against the current US$103.00 price.
For Walt Disney, however, we will make it really easy for you with previews of two leading Walt Disney Narratives:
Each one uses different assumptions about how the business evolves. This is why they arrive at different Fair Values that you can compare with the current US$103.00 share price.
Fair Value: US$112.22 per share
Implied discount to this Fair Value: about 8.2% compared with US$103.00
Revenue growth assumption: 4.3%
- Expects Disney to lean harder into parks, resorts and cruises as the main engine of the business, with a tourism centered profile and a focus on hard assets.
- Builds on a view that cost cutting, a larger Parks segment and steadier margins can support operating profit of about US$20b and net profit of about US$13b in 2028.
- Assumes an earnings multiple of 20.6x that sits between typical hotel and entertainment peers, with key risks around tourism cyclicality, competition in theme parks and faster change in media and streaming.
Fair Value: US$95.94 per share
Implied premium to this Fair Value: about 7.4% compared with US$103.00
Revenue growth assumption: 4.6%
- Emphasizes pressure from high content and sports rights costs, which could squeeze cash flow unless higher prices are accepted by subscribers without heavier churn.
- Assumes streaming demand and linear TV viewership both face headwinds from rival platforms and user generated short form content that competes for time and advertising budgets.
- Allows for growth in content sales and steady parks and products revenue, but works with a lower profit margin of 7.5% and a 30.0x P/E to arrive at a Fair Value close to US$96 per share.
If you want to see how other investors blend growth, risk and valuation into their own Fair Values for Walt Disney, you can review the full range of Community Narratives and test which story comes closest to your view of the stock. See what the community is saying about Walt Disney
Do you think there's more to the story for Walt Disney? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com