Digest: Disney, EA upgrade; Amazon mixed
Disney shares rose 2.3% on Wednesday to $29.45 after Pali Research analyst Richard Greenfield upgraded the stock, saying he was surprised by the company's show of confidence with theme parks. Disney management said that attendance is better than it was a year ago, and that prices had increased slightly. "The tone of Disney management's recent public comments leads us to believe we may be overly conservative in our fiscal 2008 forecasts," Greenfield said in raising his rating from "neutral" to "buy" and setting a target price of $34 a share. On Tuesday, Citi Investment Research analyst Jason Bazinet had downgraded the stock to "sell," saying weakness in the U.S. economy will hurt theme park results.
Shares of Electronic Arts rose 3.6% on Wednesday to $47.23 after an analyst upgraded the video game publisher, noting a recent stock pullback makes for an attractive valuation. Bear Stearns analyst Edward Urban raised his rating from "peer perform" to "outperform," saying Electronic Arts stock has lost about 24% of its value since the day after Christmas. EA is scheduled to report its fiscal third-quarter earnings today.
Amazon.com reported earnings that exceeded Wall Street's expectations, though conservative guidance sunk the stock by as much as 8% in after-hours trading. Amazon posted fourth-quarter profit of $207 million, up from $98 million a year ago. Revenue rose 42% to $5.7 billion. Worldwide media sales grew 33% to $3.3 billion, electronics and other general merchandise rose 58% to $2.2 billion and "other" revenue rose from $89 million to $131 million.