At the D23 Expo held this weekend, Walt Disney (DIS) finally announced its $60 billion plans to expand its theme park and cruise business. Although the investment was originally announced for September 2023, no details have been announced so far.

New attractions in Disney Parks

Major innovations are planned for parks in California, France and China. Highlights include rides with the themes of “Marvel”, “Avatar” and “Coco” at Disney California Adventure. Disneyland Paris, meanwhile, will present its first water experience with the theme of “The Lion King”, while Shanghai and Hong Kong will welcome a new roller coaster called “Spider-Man”.

In Florida, the Magic Kingdom is undergoing its biggest expansion yet, adding new lands themed around classic villains and Pixar’s “Cars.”

In addition to these park expansions, Disney plans to add four new cruise ships and expand its fleet to 13 ships by 2031.

Reasons for the enormous expansion

These plans come in response to increasing competition from Comcast’s (CMCSA) Universal Studios, which plans to open a new theme park near Walt Disney World in Florida in 2025. In addition, recent ticket price increases and inflation have hurt the performance of the company’s theme parks.

In Disney’s recently announced third-quarter earnings report, theme park revenue increased by just 2% compared to the same period last year, putting even more pressure on Disney to attract more visitors.

What is the price target for DIS shares?

Despite weakness in the theme park sector, analysts are optimistic about the stock due to strong momentum in the company’s entertainment and sports businesses.

On TipRanks, DIS has a consensus rating of Strong Buy based on 19 buy recommendations and five hold recommendations. Analysts’ average price target for Disney shares of $118.25 implies an upside potential of 37.17%. The company’s shares have fallen 4.1% since the beginning of the year.

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