Wells Fargo is bullish on the potential sale of Disney ‘s non-core linear assets. If the media giant sheds the networks, excluding ESPN, it will add about $10 to the share price, analyst Steven Cahall said in a note Thursday. “Divesting such assets would bring in cash and improve EPS growth,” he wrote. Disney’s segment operating income compound annual growth rate is currently 15% and could jump to 20% with the divestitures, Cahall calculated. His price target of $147 suggests 62.5% upside from Thursday’s close. DIS 5D mountain Disney’s 5-day performance On Thursday, Disney CEO Bob Iger left the door open to a possible sale of the networks, saying the company is going to be “expansive” in its thinking about its traditional TV business. “They may not be core to Disney,” Iger told CNBC’s David Faber at Allen & Co.’s annual conference in Sun Valley, Idaho. Disney’s TV network portfolio includes ABC and ESPN, although Iger said he’s open to finding a strategic partner with ESPN . On Wednesday, Disney announced it would extend Iger’s contract through 2026. Wells Fargo sees the potential sale of the TV assets as just one step in the company’s turnaround plan. “Bigger picture DIS seems to be taking increasingly bold actions,” Cahall said. “Rome wasn’t built in a day and DIS’s problems won’t be solved in Iger’s first year. But today’s interview does suggest action is underway,” he added. — CNBC’s Michael Bloom contributed reporting.
