Disney: From Sleeping Beauty to a 35% Jump, Magic Was in the Numbers All Along

By mid-August 2024, , the century-old entertainment giant, looked like one of the worst stocks to invest in after sinking more than 30% in just three and a half months.

Markets were increasingly concerned about declining margins, as Disney’s massive investments in streaming produced poor results compared to its competitors. Internal tensions within the board also worried investors, adding further downward pressure.

However, as most investors lost confidence and the media rushed to condemn Disney, despite far from disastrous results, savvy investors focused on the numbers, which suggested a potential opportunity.

On August 13, 2024, when Disney stock was trading at $85.60, InvestingPro’s Fair Value tool, which aggregates information from 14 recognized valuation models, estimated the stock’s true value at $115.56, implying an undervaluation of approximately 35%.

Indeed, the stock quickly began a recovery, reaching a peak of $116.53 in December 2024.

Fair value then remained broadly at the same level as the stock, suggesting few opportunities for the giant. However, the Liberation Day crash brought something that rarely happens in the stock market—a second chance for those who had missed the first.

Indeed, after hitting a low of $80.10 at the beginning of April, Disney shares rebounded to $124.69 by the end of June, representing a rally of over 55% in less than three months.

Since then, the stock has lost some ground, closing at $112.75 on Monday, while the Fair Value has been updated to $125.41 — implying an upside potential of just over 11%. This suggests there may currently be other, more undervalued opportunities worth seizing.

What are the most undervalued and overvalued US stocks at the moment?

Fair Value can be utilized for each stock on the market. Additionally, it can be used as a search criterion in a screener, for example, to identify all US stocks with a potential upside of over 50% based on Fair Value.

Investing.com also offers a regularly updated page featuring the best undervalued opportunities of the moment, according to Fair Value and other criteria.

Below, you’ll find the 10 stocks on this page that are currently showing the greatest upside potential according to Fair Value:

There are, for example, 6 US stocks with a potential upside of over +20% according to Fair Value, while enjoying good financial health.

InvestingPro members also have access to a page featuring the most overvalued stocks:

The 10 stocks with the greatest downside risk according to Fair Value are overvalued by between 21.17% and 33.79%, and are therefore stocks on which investors might want to take profits.

Conclusion

Ultimately, Fair Value is a dynamic tool designed to show whether a stock is undervalued at any given time. It helps investors not only to spot opportunitiesbut also to remain rational when markets panic—and to keep their feet on the ground when euphoria takes over—by staying firmly focused on fundamentals.

If you’re not yet an InvestingPro member and would like to start using Fair Value, you can subscribe to InvestingPro today using the button below:

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