Walt Disney Co. (NYSE: DIS) had a rough pandemic lockdown period. Parks closed for over a year, and the stock fell as much as 36% to start 2020.
Today, the Disney stock forecast is much brighter.
Disney has already rallied as much as 96%. The company's last quarterly report showed revenue from parks and products rising to $4.3 billion, nearly four times the pandemic levels a year ago.
Now that COVID-19 variants are emerging, however, people wonder if the stock will take another hit.
That could not be further from the truth. In fact, Disney stock is more likely to double in the next five years than lose on another COVID-19 breakout.
That's because our Disney stock forecast for 2025 depends on more than Disney Land being open. One revenue stream that can't be touched by the pandemic is running full-steam ahead.
And it will supply an increasingly large portion of Disney revenue in the years to come...
Why Disney Stock Is on the Rise
Yes, we're talking about the Disney+ streaming service.
The service has been a hit since it launched in 2019. Its report for Q3 2021 boasted 174 million subscriptions.
Compare that to Hulu at 42 million. It's definitely not in the same league, closer to the 200 million subscribers claimed by Netflix Inc. (NASDAQ: NFLX) or Amazon.com Inc. (NASDAQ: AMZN).
The quarterly report also showed Disney's media and entertainment arm bringing in 18% more revenue from the previous quarter. That shows that streaming is in fact a growing revenue stream for Disney.
But it's not done yet...
Disney+ has yet to make it to parts of Asia and Latin America. But it says that Japan will have access to the service in October, followed by Taiwan, Hong Kong, and South Korea in November.
As Disney+ makes it around the world, and company continues to produce premium, unmatched content, streaming will play a key role in skyrocketing the Disney stock.
Of course, streaming doesn't have to carry the whole company, either.
Disney also profits from more traditional media, like box office sales. As more people get vaccinated, movie theaters reopen. This has translated into successful box office showings from Disney.
The "Black Widow" U.S. premier brought in $80 million, the biggest opening day for a film since the start of the pandemic. Streaming purchases - a new trend where streamers can rent in-theater movies on-demand - added another $60 million to the top line.
That's just one of Disney's giant collection of universally beloved franchises including Star Wars, Marvel, and a host of classics from decades past.
Now, here's why Disney could be one of the best stocks to buy today...
Is Disney Stock a Buy Now?
Disney stock trades for $177 today. It's down from a year-high of $197, which could indicate a buy opportunity. The stock seems to have steadied at the $170-level since May.
Since it appears to be bottoming out at the current price level, now is probably an opportune time to buy, as the stock could be gearing up for another massive rebound soon. If it crosses back into the $180 territory, it could gain some added velocity and a greater chance at shooting back to $200.
If we look at Disney's relative strength index (RSI), we see that Disney is not far from reaching intrinsic value. The RSI is a value comparing a stock's price against the rest of the S&P 500, and it hints at whether a stock is overvalued or not.
The current Disney RSI is 60, and an RSI of 70 usually tells us a stock is overbought. That said, an RSI slightly under 70 could point to some - if minimal - headroom for the Disney stock price in the next year.
The average 12-month target among 23 analysts is $213, which should already make $177 a bargain. But the high target is $230, which would be a solid 30% gain for today's investor.
So, the current Disney stock price level is a great discount for anyone who wants to hold Disney in the long run but is looking for an entry point.
Of course, that does not tell us the whole story of what could happen in the longer term, which is certainly more bullish for Disney.
If it can stay on its current course, Disney stock could be due for enormous gains over the next five years...
Disney Stock Forecast for 2025
Disney hopes to reach 194 million streaming subscribers in 2025. That puts it directly in league with the likes of Netflix and Amazon.
We've discussed the streaming war a bit on our site, and how difficult it will be for any one company to separate itself as the "top storyteller" in the market. But Disney is different.
Unlike Apple Inc. (NASDAQ: AAPL) with its Apple TV+, Netflix, Amazon, or anyone else, Disney has a longstanding formula for telling stories that has gained a loyal audience over nearly a century.
That should be a strong case for Disney withstanding any future changes in tastes and preferences for content. While other streamers appear to be throwing everything at the wall - many hits, many misses - Disney operates from a solid base of past fan-favorites as well as its Marvel and Star Wars contracts.
So, as we mentioned above, Disney streaming in the future will play a bigger role in the company's bottom line.
CoinPriceForecast predicts Disney could hit $310 by 2025, and $366 by 2026 - a 105% potential return for today's investor. If the company continues firing on all cylinders - parks, streaming and all - this would not be out of the question.
Of course, even if it does not go to those levels that quickly, Disney is a great stock to buy at current levels. This is one of those stocks you want in your portfolio for the long haul, and it's great anytime you can get it cheap.
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