Image: Disney.com

Shares of Disney (DIS -0.04%) are up about 21% so far this year. At over $92 per share, Disney's stock does not look cheap trading at a P/E of nearly 22 times.Still, the House of Mouse is priced below the industry average of 24 times, and compared to others, Disney still looks like the highest performing stock in its category.

Even following the recent rise in price, Disney shares seem to be a discount to their potential future value.

To infinity, or at least $100
In fiscal 2014, Disney posted a 22% increase in earnings per share, to $4.26. The expectation for fiscal 2015 year-end EPS is $4.67, a modest 10% jump from 2014. Assuming a constant P/E of about 22 times, this would mean a valuation of about $102 by September 2015, the final month of Disney's fiscal year.

Getting to that higher EPS would require the company to operate as efficiently as it is now. The company continues to efficiently run revenue through to earnings at an operating margin of 23.2%. Because Disney's operating margin has continued to be a highlight in recent years, growing steadily from around 15% in 2009 to the more than 23% it stands at now. Continuing to grow or even maintaining this operating margin, while also gaining higher total revenues, could help to bring the company to the fiscal 2015 EPS target stated above. 

And beyond: Growth for the long term
It is easy to point to Disney's recent EPS growth, record theme park attendance, and new movies to be released next year to see how earnings can easily grow 10% by the end of the next fiscal year. But for Foolishly long-term investors, what will drive growth in the years to come? More great movies, along with a new theme park in China, are sure to help the company grow earnings well into the future.

1.) More great movies

Frozen and Guardians of the Galaxy are two examples of how Disney has been able to create incredibly profitable blockbuster movies in the last few years. It looks like 2015 will be even better. Disney has many big projects in the works, and CEO Bob Iger said the company will continue to increase its film output in coming years. In the recent earnings report, he said Disney plans to release 21 films in the next three years, compared to 13 in the past three.  . The coming new Star Wars film, following Disney's acquisition of Lucasfilm, as well as more big movies in the Marvel franchise, are just some examples of what Disney fans and investors can expect in 2015 and later.

2.) Disney's newest resort in Shanghai

China already represents a major growth market for Disney thanks to the nation's booming movie-going audience. Looking at the market's growth in the last decade, it's easy to see why analysts expect China to become the largest film and media market in the world in the next few years. 


Source: ChinaFilmBiz.com

Disney's earnings release noted record attendance at the company's theme parks around the world in 2014. That figure will likely grow next year, when Disney opens a resort in mainland China.


Photo: Disney.

This $4.4 billion resort covering 1,000 acres will be about three times the size of Hong Kong Disneyland. It will include many familiar Disney World elements, as well as many new attractions unique to this resort, such as the recently announced massive Toy Story-themed hotel.

Disney's competitors have not forgotten about the potential market: Both DreamWorks and Comcast have announced plans for their own parks in China. Oriental DreamWorks, of which DreamWorks Animation is a 45% stakeholder, is building its own park near Shanghai. Meanwhile, Comcast is building a Universal Studios resort near Beijing.

These two other parks are set to open between 2017 and 2019, making Disney by far the pioneer in major U.S. theme parks to enter the Chinese mainland.

With earnings that will easily increase next year, potentially pushing Disney's stock past $100, there is upside to this investment already. Add in plenty of reasons to believe in the company's long-term growth, and it looks like a great time to keep watching Disney.