To what extent can shares of The Walt Disney Company (DIS) regain their magic in 2017? That's one of the major questions on investors' minds, especially amid concerns declining subscribers at the company's flagship sports network ESPN.

Disney shares closed Friday at $104.22. Although Disney was one of only three companies in the Dow Jones Industrial Average (DJI) to end 2016 in negative territory (along with Nike (NKE) and Coca-Cola (KO)), Disney shares ended the year on a strong note, gaining 12.23% in the past three months. And if you buy into the Dogs of Dow theory, which suggests the laggards of one year can outperform in the following year, Disney stock should be on your radar.

Despite the struggles at ESPN, Wall Street continues to believe in Disney. Anthony DiClemente, analyst at Instinet media, who has a Buy rating and $110 price target on Disney shares, thinks too much emphasis is being placed on the network. In an appearance on CNBC's "Power Lunch" last month, DiClemente explained that ESPN subscriber metrics also ignore the new, "skinny" digital video bundles from Dish Network Corporation's (DISH) Sling TV or Sony Corporation's (SNE) PlayStation Vue. 

For the same reasons, analysts Joseph Bonner at Argus recently reiterated a Buy rating on Disney shares, along with a price target of $129. Argus' price target assumes premiums of almost 24% from current levels. The company is "positioning itself for long-term growth," noted Bonner. Barclays analyst, who also upgraded Disney stock, note that ESPN is "de-risked" going into 2017.

Looking ahead, for the quarter that ended December, Disney is expected to deliver $1.50 per share on revenue of $15.30 billion, up 0.8% year over year. For the full year, ending November 2017, earnings are projected to rise 3.8% year over year to $5.94 per share, while revenue of $57.69 billion would mark an increase of 3.7% year over year.

While these aren't breathtaking expectations, that also plays favorably into Disney's ability to beat its numbers. Add in the fact that Disney shares are trading some 15% below its all-time high of $122.08 despite growing earnings per share at double-digit rates, Disney stock can emerge magical in 2017.

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