Disney parks' theme is gloom

Earnings forecast for 2nd quarter, full year lowered

By JILL GOLDSMITH

Walt Disney's theme parks haven't been much fun for Wall Street lately as cold weather and war talk erode profits at the division.

On Wednesday, Merrill Lynch and Lehman Brothers lowered Disney's earnings forecast for the fiscal second quarter and full year based on theme park worries. Merrill's Jessica Reif Cohen slashed quarterly earnings per share to 11¢ from 14¢. She sees theme parks revenue down nearly 30% from her previous estimate to about $200 million. The Mouse's second quarter ends in March.

Reif Cohen dropped her full year EPS forecast to 64¢ from 70¢.

Shares dip

Disney shares fell 0.69% to $15.94, down from a 52-week high of $25 last spring. Company is planning its annual stockholders meeting in Denver on March 19. One shareholder resolution up for vote takes issue with executive compensation, asking the company to restrict awards of stock options to top execs.

Lehman's Stuart Linde dropped the target price on Disney stock to $21 from $23.

On Tuesday, Jordan Rohan, an analyst with SoundView Technologies, expressed concerns about Disney's theme park business.