The company has made several changes to its theme parks in recent months, including bringing back its Walt Disney World annual park passes after halting sales more than a year ago. The analyst added the company's new labor contract in Florida, coupled with the accelerated depreciation of the Starcruiser hotel, will further pressure margins. We worry the 'tough comps' are not properly reflected in consensus," he wrote in a note to clients on June 29. "Disneyland growth due to its 100th anniversary celebration is more than offset by contraction from comparisons against its 50th anniversary celebration. KeyBanc Capital Markets analyst Brandon Nispel, who downgraded the stock late last month on "meaningful uncertainty" surrounding the 2024 financial setup, said recent theme park softness was a top headwind heading into earnings. Last year, the business accounted for 65% of Disney's total segment operating income of $12.1 billion. In its latest quarter, the operating income for the parks hit $2.17 billion, representing a 23% year-over-year increase. Disney's parks business remains important to the company's bottom line - hence Wall Street's concerns.
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