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Disney facing tough challenges?

While Disney's earnings have performed well in the past financial year, one analyst is pouring cold water on the notion that the boom is set to continue.

While Disney's earnings have performed well in the past financial year, one analyst is pouring cold water on the notion that the boom is set to continue.

According to a Forbes report, Steven M Frenkel at PatternWatch believes that the outlook for the company is going to be tough in 2008.

Disney's earnings rose by 24 per cent to USD 3.6 billion for the year ending September 30, and it also sold two lifestyle magazines.

But Frenkel believes that the current economic climate will impact its theme parks, while the Writers Guild strike threatens its ABC network.

And crucially the USD 130 million spent on the decision to bring videogames development in-house is, according to the report, a "costly excursion onto unknown turf."

Disney's current share price is USD 32.79, trading around the mid-range of the year's high and low prices.

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