Image source: Disney.

There are some storm clouds in Walt Disney's (DIS 0.55%) horizon, as a one-time bull on the stock is tempering his enthusiasm. Stifel Nicolaus analyst Benjamin Mogil is downgrading the shares, taking his rating from buy to hold with a fair value estimate of $110.  

Mogil's primary concern stems from Disney's media business, a problem since it's Disney's largest segment in terms of revenue and an even bigger contributor to its operating profit. He feels that operating income will be flat for Disney's media segment in the new fiscal year that kicks off in October. Increasing programming costs at ESPN in a challenging cord-cutting climate make it a tricky time for Disney's most lucrative business.

The analyst is upbeat about Disney's prospects for its studios, consumer products, and theme parks, but it's hard to remain bullish given the stock's valuation when so much is riding on the House of Mouse's media business that's not firing on all cylinders these days.   

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Mogil initiated coverage with of Disney with a bullish buy rating early last year. He went on to lift his price target on the media giant last August, going from $120 to $130 just ahead of Disney announcing its fiscal third-quarter results. It was crummy timing. Disney stock would peak a day after his boost, only to tumble after a problematic quarterly report that exposed the growing decline of subscribers at ESPN.  

He remained bullish three months later with the same price target, despite Disney's 10-K filing revealing that ESPN had shed 3 million domestic subscribers over the past year. Mogil also voiced concerns about more modest declines at Disney's other cable properties, but ultimately felt that it was one of the better diversified companies in its niche.   

A month later Mogil reiterated his $130 price target as Star Wars: The Force Awakens shattered box office records. He was particularly impressed at the high turnout rate for female moviegoers given the strong female lead, something that could help the franchise through this next wave of films.   

Things then turned less upbeat a few weeks into the film's run. Mogil kept his buy rating intact in January, but lowered his price target to $110. The sluggish stock price and long gap between Star Wars films kept his optimism in check, but at least he remained bullish. 

Even April's surprising resignation of COO Tom Staggs -- something that brought CEO Bob Iger's succession plan into the forefront -- didn't rock Mogil. He remained bullish with his price goal at $110.

Mouse trap

The stock is essentially where it was when Staggs announced that he was leaving, so it's not exactly clear why the same $110 price target is now a neutral call when it was a bullish one three months ago. 

The timing is still important. Disney is now three weeks away from announcing its fiscal third-quarter results. This was the same quarter that burned Mogil last summer, as he bumped his price target higher the day before the stock hit what remains its all-time peak.

He is taking a more cautious approach this time. The problems with its media networks linger. Theme park attendance in Florida appears to be an issue. Disney will have a lot to prove in three weeks, and it's going to have to come up strong to win at least one Wall Street analyst back.