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What Wall Street's looking for in Disney earnings

Image Source: Toys R Us

Disney has a reputation for beating expectations—it doesn't issue guidance—and Wall Street is expecting an impressive quarter when earnings are announced after the bell Wednesday.

Deutsche Bank has a "buy" rating on the stock and calls Disney its "top pick in media," projecting 15 percent to 18 percent earnings-per-share growth every year over the next three years. Bank of America Merrill Lynch just upgraded the company to "buy" and added it to the firm's list of "high conviction stock ideas."

The studio division is expected to skyrocket on the massive box office success of "Frozen." The film grossed $864 million worldwide, and it won the Golden Globe for best animated feature and is nominated for two Oscars. The soundtrack topped the Billboard album chart.

Now Disney has opened a sing-along version to keep the box office success going, and it has announced plans to turn "Frozen" into a musical. Plus, Marvel's Thor sequel "The Dark World" has grossed $633 million worldwide. Those kind of huge theatrical numbers generally indicate that related consumer products have been selling well.

Disney's biggest engine is its Media Networks, where advertising growth will be in focus, as will subscription fees.

ESPN, arguably Disney's crown jewel, is expected to benefit from its college football coverage and a 9 percent increase in Bowl Championship Series viewership over last season.

But Evercore analyst Alan Gould warns that ESPN's numbers for the quarter could be misleading, as sports costs will be weighted to the second half of the year, with a new Major League Baseball contract, the World Cup and a new NFL contract. Disney's broadcasting division is expected to suffer from tough comparisons to the year-ago quarter, which was bolstered by political ads.

Revenue at the company's theme parks could be impacted by the unseasonably cold weather and unusually high flight cancellations. Still, theme park attendance and spending has grown, despite higher ticket prices.

One possible indicator in that sector: Comcast (CNBC's parent company) reported gains at its theme parks in the fourth quarter, thanks to higher attendance.

And there are a number of bits of news that could drive analyst questions. Disney is expected to soon close in on a carriage deal with DISH Network; there have been reports that Disney will lay off several hundred employees at its Interactive division after restructuring the video game division last year.

(Read more: Disney to lay off hundreds in gaming unit)

We could also hear some questions about how potential cable consolidation could impact the media giant.

I'll be interviewing CEO Bob Iger in a first on CNBC interview after earnings are out, before the company hosts its quarterly earnings call at 5 p.m. EST.

—By CNBC's Julia Boorstin. Follow her on Twitter @JBoorstin.

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