Is This Blue-Chip Icon the Best Cheap Stock You Can Buy for 2026?

Core Viewpoint - Walt Disney (DIS) stock has been underperforming, remaining sideways over the past 12 months due to mixed results, with missed revenue estimates but better-than-expected EPS. However, the company's outlook for FY26 and FY27 suggests an attractive entry opportunity [1] Financial Performance - For FY25, Disney reported a 3% year-on-year (YoY) revenue growth to $94.4 billion, with the entertainment segment growing by 3% and the experiences segment by 6%, while the sports business remained flat YoY [3] - In Q4 2025, Disney had 131.6 million paid subscribers, reflecting a 3% quarter-on-quarter (QoQ) increase, indicating potential for sustained subscriber growth due to strong content assets [5] - Disney ended FY25 with $5.7 billion in cash and total debt of $42 billion, which decreased by $3.8 billion YoY, suggesting a strong cash position and ongoing deleveraging prospects [7] Market Outlook - Wolfe Research analyst Peter Supino assigned an "Outperform" rating for DIS stock with a price target of $133, arguing that the stock is undervalued at 16 times FY26 earnings compared to S&P 500 multiples and Netflix's market value, emphasizing the value of Disney's intellectual property [2] - Despite a 7% stock correction in the past six months, the company has an optimistic outlook for FY26 and beyond, presenting a potential accumulation opportunity before growth acceleration triggers positive price action [4] - The experiences segment is expected to benefit from the addition of two new cruise ships and ongoing expansion projects at theme parks, providing visibility for future growth [6]