The Best and Worst Dow Stocks for the Next 12 Months

3. The Walt Disney Company (NYSE:DIS)

Upside Potential: 42.6%

Market Cap: $158 billion

Number of Hedge Fund Holders: 108

The Walt Disney Company (NYSE:DIS) is a diversified global entertainment company that operates media networks, streaming platforms, parks and experiences, and entertainment studios. The company owns several well-known brands, such as ESPN, Marvel, Pixar, Lucasfilm, and Disney+.

In early April, ClearBridge Investments revealed a new position in Disney, per its “ClearBridge Value Strategy” Q1 2025 investor letter. The fund believes the company is progressing well with its streaming service, which could lead to better-than-expected profit margins and earnings. They also highlighted the company’s shift in strategy. As per this change, instead of focusing on aggressive market share gains, the company is now working on improving prices, which should boost profitability.

In another vote of confidence for the stock, an analyst at Wolfe Research upgraded Disney to Outperform with a price target of $112 (~23% upside). The analyst highlighted the strength of Disney’s business model amid increasing risks of recession, and that the stock is already factoring in a downturn. He believes the company has a strong positioning in parks, cruises, and streaming businesses, which could support EPS to rise to $7. He also sees the current valuation as compelling because the company trades at a significant discount to the S&P 500.