Are You Overpaying For Disney Stock Versus Its Rivals

Investors are currently paying 21.9 times trailing twelve-month earnings for shares of Walt Disney (DIS). That valuation is the highest multiple in a group of four major media and entertainment companies : Disney, Netflix, Comcast, and Fox. Despite carrying the premium multiple, Disney ranks third among these peers in both sales growth and operating margin. So what does the same money buy at Disney's closest-priced rival?

What The Same Price Buys You At Netflix

At Netflix, a nearly identical price yields significantly faster growth and a wider margin. The streaming company trades at 21.7 times earnings, sitting just below Disney. Over the past twelve months, Netflix expanded its sales by 16.0%, compared with 4.6% at Disney. Netflix also retained 29.7% of its sales as operating profit, coming in at nearly double the 15.2% recorded by Disney.

The remaining two peers offer cheaper valuations. Fox trades at 15.6 times earnings while still outpacing Disney on both growth and margin. Comcast is the only company in the group trailing Disney on those two metrics, and its stock trades at just 6.6 times earnings. For Disney shareholders, that means paying the highest multiple in this peer group for financial results that sit in the lower half.

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What Are You Paying For At Disney?

Investors are backing a business where operating profit is expanding at a faster pace than sales. Disney reported an operating margin of 8.5% three years ago and 12.5% two years ago. That figure climbed to 14.8% a year ago and has continued to edge higher since.

Disney also operates well beyond film and television. Its Experiences segment, the theme parks and cruise line, generated $36.2 billion during fiscal 2025. That figure climbed 5.9% from the prior year, marking the fastest growth across Disney's three business segments. Management noted that the $9 billion allocated for fiscal 2026 capital spending is meant to accelerate growth within this Experiences division.

During the company's fiscal Q3 2026 earnings call on August 5, management highlighted Experiences and streaming as the active growth drivers. In that quarter, the global guest count at Disney rose 4% from a year earlier. Furthermore, executives pointed to a 4% increase in spending per guest to demonstrate that the company is not relying on discounts to fill its parks.

What Earnings Has Disney Told Shareholders To Expect?

For fiscal 2026, Disney provided guidance expecting adjusted earnings per share growth of 16%. That target remained unchanged when management issued the August 5 release, and the final result is still pending.

Management also named two areas of weakness on the earnings call. Management observed a softer consumer at the Shanghai and Hong Kong parks during fiscal Q3, noting that this trend carried into fiscal Q4. Additionally, executives stated that expanding supply in the streaming market is creating pricing pressure for both Disney and others.

This official earnings guidance represents the kind of profit growth the price appears to assume. Over the past three years, Disney has seen its operating margin rise annually. When the company reports its fiscal fourth quarter, investors will be watching closely to see how the final adjusted earnings per share growth compares against that 16% guide.

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