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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: sun-tzu who wrote (145436)	1/23/2002 3:23:54 AM
From: sun-tzu	Read Replies (2) \| Respond to of 436258

Wonderful, Worldwide Disney (this is from doug kass who is quite pompous but well researched and a successful shorter) 1/22/02 10:06 AM EST In the difficult equity market that I envision for 2002, few stocks meet my criteria for investment. In the last week I have mentioned several that do make sense as long term investments: Halliburton (HAL:NYSE), Dow Chemical (DOW:NYSE), Philip Morris (MO:NYSE) and General Dynamics (GD:NYSE). You could say that in 2002, "it's a small world after all" from a long investment standpoint, like the preceding two years. That's my lead to Real Moolah investors for another attractive stock that I am now purchasing: Walt Disney (DIS:NYSE). Many investors see Disney as an inevitable beneficiary of an improving environment for domestic tourism post Sept. 11. While that might be a very good reason for buying DIS, my interest is different and was piqued by the cover story ("Disney, Invader: Inside the Ultimate Culture Machine") of the February issue of Wired magazine. To be sure, Disney has its share of problems, most notably an advertising downturn and a slump in tourism. But most of these problems are well known, and, in time, will no doubt turn around. What isn't well known is the sweetheart deal that Disney has made in preparation for the opening of Hong Kong's Disneyland in 2005. With Asia's massive population and emerging economies, Asia is the promised land for American culture merchants. And for Disney, China is the key wedge into a grand Asian strategy. Disney erred with EuroDisney by having too much financial risk, but the company will not make that mistake in China (some critics in Hong Kong have suggested the joint venture is a "giveaway" by the government to Disney). For only $314 million, Disney will own 43% of the park in China, as well as earning royalties and management fees. The Hong Kong government gets a majority of the park, but only after spending $1.7 billion on infrastructure expenditures, plus a capital contribution of $417 million. Additionally, the government will lend the joint venture another $718 million! In essence, for very little capital, Disney has secured a huge and potentially profitable way of entering the burgeoning Chinese market. And, with Disney's shares down from the May 2000 peak of $44, I like the odds. P.S. Wired is a must-have. I recommend you subscribe. Long DIS, HAL, MO, DOW, GD.