As of May 22, 2025, Walt Disney Co's estimated intrinsic value ranges from $52.58 to $83.48 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $83.48 | -24.4% |
| Discounted Cash Flow (5Y) | $75.29 | -31.8% |
| Dividend Discount Model (Multi-Stage) | $59.10 | -46.5% |
| Dividend Discount Model (Stable) | $75.51 | -31.6% |
| Earnings Power Value | $52.58 | -52.4% |
Is Walt Disney Co (DIS) undervalued or overvalued?
With the current market price at $110.46, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Walt Disney Co's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.87 | 1.17 |
| Cost of equity | 7.9% | 11.4% |
| Cost of debt | 4.0% | 4.9% |
| Tax rate | 26.8% | 30.5% |
| Debt/Equity ratio | 0.22 | 0.22 |
| After-tax WACC | 7.0% | 10.0% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $75 | $173,149M | 79.7% |
| 10-Year Growth | $83 | $187,947M | 61.8% |
| 5-Year EBITDA | $119 | $251,879M | 86.0% |
| 10-Year EBITDA | $120 | $254,150M | 71.7% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $10,836M |
| Discount Rate (WACC) | 10.0% - 7.0% |
| Enterprise Value | $108,676M - $155,502M |
| Net Debt | $37,037M |
| Equity Value | $71,639M - $118,465M |
| Outstanding Shares | 1,808M |
| Fair Value | $40 - $66 |
| Selected Fair Value | $52.58 |
| Metric | Value |
|---|---|
| Market Capitalization | $199688M |
| Enterprise Value | $236725M |
| Trailing P/E | 22.41 |
| Forward P/E | 30.52 |
| Trailing EV/EBITDA | 14.75 |
| Current Dividend Yield | 83.98% |
| Dividend Growth Rate (5Y) | -3.68% |
| Debt-to-Equity Ratio | 0.22 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $25.04 |
| Discounted Cash Flow (5Y) | 25% | $18.82 |
| Dividend Discount Model (Multi-Stage) | 20% | $11.82 |
| Dividend Discount Model (Stable) | 15% | $11.33 |
| Earnings Power Value | 10% | $5.26 |
| Weighted Average | 100% | $72.27 |
Based on our comprehensive valuation analysis, Walt Disney Co's weighted average intrinsic value is $72.27, which is approximately 34.6% below the current market price of $110.46.
Key investment considerations:
Given these factors, we believe Walt Disney Co is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.