A trip to theme parks owned by Walt Disney Co
An analyst says this could be a great thing for Disney's financials.
The Disney Analyst: Goldman Sachs analyst Michael Ng reiterated a Buy rating on Disney and raised the price target from $120 to $125.
The Analyst Takeaways: Disney could add $220 million to $230 million in revenue from the sale of one million Lightning Lane Premiere Pass sales in 2025, Ng estimated in a new investor note.
"Beginning late October 2024, Disney will roll out a pilot program for Lightning Lane Premiere Pass, a new tier of its Lightning Lane pass offering available at both Walt Disney World and Disneyland Resort," Ng said.
Lightning Lane Premiere Pass gives guests a one-time entry to each Lightning Lane experience in a theme park per day, without having to choose arrival times.
"Premiere Passes largely remove these restrictions allowing guests more flexibility in accessing the most in-demand attractions."
The new Premiere Passes range in price from $129 to $449 per pass per park for Walt Disney World based on the data. Premiere Passes at Disneyland cost $400 per pass for visits now through Dec. 31, 2024, and range from $300 to $400 per pass beginning on Jan. 1, 2025.
Providing another potential boost to Disney's revenue is the fact that Premiere Passes are only available to guests staying at Disney hotels or other select hotels for Disney World visits, the analyst added.
Ng estimates one million total Lightning Lane Premiere Passes could be sold in 2025, broken down as 700,000 at Walt Disney World and 300,000 at Disneyland. The analyst estimates an average net revenue of $175 for Disney World and $308 for Disneyland.
While the Lightning Lane could prove beneficial to the company's Parks and Experiences segment, Ng cautions that the later-than-expected maiden voyage of the Disney Adventure cruise ship could have a negative $300 million impact for fiscal 2025 as the voyage falls into fiscal 2026 now.
DIS Price Action: Disney stock is up 0.52% to $95.90 on Friday versus a 52-week trading range of $79.23 to $123.74. Disney stock is up 7% year-to-date in 2024.
