Rating agency Cowen upgraded Disney (NYSE:DIS) stock ahead of the company's investor day later this week, citing Disney's new streaming service and next "Star Wars."
"We view Disney's catalyst path for the next year as highly attractive, and believe Thursday's investor day will likely be a deck-clearing event for sentiment," Cowen's Doug Creutz said in a note.
Cowen upgraded Disney to outperform from market perform and raised its 12-month price target to $131 from $102. Disney shares added nearly 1 percent in premarket trading Tuesday following the call.
"Disney has a very powerful pipeline of product that will play out over the balance of the year," wrote Creutz. "On the film side, we believe Disney's slate could drive a $3B calendar year Studio operating profit. We also believe the slate, principally the Q4:C19 releases Frozen 2 and Star Wars Episode IX, should set the stage for a re-acceleration in Consumer Products performance in 2020."
"We believe the launch of Star Wars: Galaxy's Edge at both domestic parks this summer should catalyze continued strong growth in 2H:F19 and FY20," he added.
At investor day, Disney is expected to give details on its new streaming service Disney+. Investors also await details on the road ahead following its $71 billion deal for Fox's entertainment assets, which closed at the end of March.
Disney shares are up about 5% this year, below the S&P 500's return of 15%. Those shares began the trading day Tuesday ahead 99 cents to $115.95
