Here’s Why Disney’s Shares Are a Buy

Things are going better than expected in Disney land.

Guggenheim Securities upgraded its rating on Disney (dis) early Tuesday, moving the entertainment giant up from neutral to buy based on the back of high anticipation for its upcoming schedule of movies and new additions to its amusement parks. Disney, which sits at $ 112.65 in midday trading, now has a 12-month price target of $ 128 a share, up from $ 118.

Tuesday’s upgrade shook off worries about ESPN’s profitability, which had been a major concern for many on Wall Street. The Disney-owned sports network has seen its revenue drop over the last five years as more viewers have shifted away from buying cable subscriptions. In 2011, ESPN had just above 100 million subscribers, but that figure has dropped to around 88 million today. Considering the network makes $ 7 a month per subscription – a figure that doesn’t even include the money made off its many secondary networks such as ESPN2 or ESPN Deportes – Disney is missing out on over $ 1 billion a year. The shift in viewer’s watching habits has prompted ESPN to look to digital streaming to keep its audience numbers up.

Despite that hiccup, Guggenheim is still confident in Disney partially because it has an extremely strong slate of movies coming. The live-action version of ‘Beauty and the Beast,’ which opens on Friday, is expected to be a huge hit. There are also two ‘Star Wars’ films set to be released over the next year or so, as well as four Marvel superhero installments. As is if that weren’t enough, the coming sequels to smash hits like ‘Frozen’ and ‘Toy Story,’ plus another Indiana Jones movie, which are basically guarantees to keep a ton of money rolling in.

The excitement around some of these movies isn’t just limited to the silver screen. Disney’s amusement parks are set to open up two major new attractions that should prove to be huge boosts to traffic. The first, an ‘Avatar’-themed attraction set to open at Disney World in May, should bring in plenty of visitors eager to experience the highest-grossing film of all time. But it’s likely the second attraction will bring customers in even larger droves. Star Wars Land will open at both Disneyland and Disney Hollywood Studios in 2019.

Disney has been on a strong run over the last six months or so. Shares of the company are up more than 24% after they bottomed out at $ 90.32 in mid October, shortly before company CEO Bob Iger warned of the potential for lagging earnings for fiscal 2017 thanks to the billions of dollars ESPN laid out to continue to have rights to broadcasting NBA games, among other factors.