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Wells Fargo Pick Disney For ‘Large-Cap Growth’ in 2022…Here’s Why

Trade Disney Stock Your Capital Is At Risk
Updated 4 Jan 2022
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  • Disney+ attendance is expected to return by Q422
  • Content spending is set to increase by $8B to manage expectations
  • Wells Fargo argue Disney is well-positioned as a ‘large-cap growth stock’ for 2022

2021 proved to be a mixed year for Disney (NYSE: DIS), their latest earnings report outlined a growing subscriber base, but at a rate of growth that didn’t exactly wow Wall Street – stock sunk accordingly as investors sought more reliable streaming services like Netflix. Yet Disney has a habit of overcoming the obstacles that constantly rival its place at the top, but with firmly rooted competitors relishing a reliable customer base – some investors aren’t quite convinced. 

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Well, over at Wells Fargo; it’s a slightly different story. Analyst Steven Cahall outlines the pragmatic obstacles that Disney might face in remaining a leading streaming contender, and in order to meet its fiscal 2024 subscriber guidance. Cahall went as far as to surmise Disney’s 2022 backdrop as a “proper execution story”, and that given the company’s history in living up to content expectations – the following year could provide great opportunities for large-cap investors. 

Cahall maintained an Overweight rating of the stock and a price target of $196 – equating to a 25% potential upside. Disney plan on increasing their content spend by $8B to a total of $33B, yet the company still needs to average  27M net adds per year from FY22 to FY24 in order to align with Disney+ guidance. Disney+ is also worth $114B less than rival Netflix, offering further growth potential.

For large-cap investors looking for the 2022 growth stock to bolster their portfolio, Disney might be worth looking at. Wells Fargo certainly seem to think so…

 

Should you invest in Disney shares?

If you’re a smart investor, you will know that having large-cap stocks in your portfolio is vital. They are more mature companies, considered safer investments, trade with less volatility, have greater analyst coverage, and in most cases, have a steady dividend stream. Due to the current market environment, we think now is the perfect time to add large-cap stocks to your portfolio. But which large-cap shares should you buy? Our stock analysts regularly review the market and share their picks for some of the best large-caps to invest in