STOCKREPORTS	The Walt Disney Company	NYSE Symbol DIS In S&P 500

Recent Price 24.00 52 Wk Range 34.80 - 15.50

Yield 0.9% 12-Mo. P/E NM

Quantitative Evaluation: Outlook (1 Lowest - 5 Highest) 2+ Fair Value 21.80 Risk MEDIUM Earn/Div Rank B
Technical Evaluation: BEARISH since 04/02 Rel. Strength Rank (1 Lowest - 99 Highest) 60 Insider Activity NA

Overview 01-FEB-02

We look for FY 02 (Sep.) revenues to approximate the $25.3 billion reported for FY 01, boosted by inclusion of the Fox Family Worldwide business, which DIS acquired in October 2001. The acquisition is expected to be dilutive to EPS in FY 02. Also, we look for profit from DIS's media networks segment to be hurt by a relatively weak advertising environment, and expect that the U.S. theme park business will be adversely affected by increased consumer reluctance to travel following recent terrorist attacks in the U.S. Excluding unusual items, net income for FY 02 is projected at $1.3 billion ($0.63 a share), compared to a pro forma $1.5 billion ($0.72) in FY 01. In FY 02, this EPS comparison is expected to receive a benefit of about $0.26 related to a change in accounting for non-cash goodwill charges. In FY 03, we look for overall EPS of $0.80.

Valuation 01-FEB-02

As of early February 2002, the stock had outperformed the S&P 500, year to date, after underperforming in 2001. The stock fell sharply after the terrorist attacks in the U.S. on September 11, as investors became increasingly concerned about the U.S. economic climate and the outlook for travel to Disney theme parks. However, the shares have largely recovered since then, helped by better -than-expected earnings in FY 02's first quarter, and expectations of profit improvement in FY 03. We expect that longer-term results of the company and the stock will be helped by increased demand for digital video disks and by international theme park openings. However, in our view, at the current share price, the company is selling at an adequate enterprise value of about 12X estimated FY 03 EBITDA.

Key Stock Statistics

Fiscal Year Ending Sep. 30

Business Summary 01-FEB-02

The Walt Disney Co., with operations ranging from theme parks and retail stores to movies and broadcasting, aims to combine imaginative material with masterful marketing, as it delivers popular culture worldwide. In October 2001, DIS acquired Fox Family Worldwide, Inc., whose assets included the Fox Family Channel in the U.S. and interests in some international channels, for $2.9 billion in cash, plus the assumption of $2.3 billion in debt.

DIS's filmed entertainment operations include production and distribution of theatrical motion pictures, television shows and home videos. DIS also owns and operates 10 television stations, the ABC TV network, and various radio stations. In cable television, DIS owns and operates The Disney Channel, has 80% ownership of various ESPN cable channels, and has an equity interest of 50% or less in various cable networks, including the Lifetime cable channel (50%), the E! Entertainment cable channel (39.6%), and the Arts & Entertainment cable network (37.5%).

Theme park and resort assets include the Walt Disney World Complex in Florida, which contains the Magic Kingdom, Epcot Center, the Disney-MGM Studio Theme Park, the Animal Kingdom, and at least 13 hotels owned by DIS. Also, DIS's operations in Anaheim, CA, include the Disneyland theme park, some hotels, and a new theme park called Disney's California Adventure, which opened in February 2001. In Japan, Tokyo Disneyland is owned and operated by Oriental Land Co., Ltd., pursuant to a licensing agreement. A second, nearby, theme park, Tokyo DisneySea, opened in September in 2001. DIS also owns about 39% of Euro Disney S.C.A., a French company that operates the Disneyland Paris theme park business; a second DIS-related park is to open near Paris in March 2002. In November 1999, planned development of a Disney-related theme park project in Hong Kong was announced. The project, in which DIS would initially have a 43% equity interest (excluding convertible subordinated shares to be owned by the Hong Kong government), may open in 2005 or 2006. Much of the financing (equity and debt) would be provided by the Hong Kong government.

Other operations or assets include merchandise licensing, a chain of more than 600 Disney retail stores, ownership interests in two California professional sports teams, and the Disney Cruise Line.

In November 1999, DIS created a new common stock, Go.com, related to various Internet businesses and direct marketing operations. However, in January 2001, DIS said it would discontinue its Go.com Internet portal and would continue to focus on other Internet sites, including ones related to entertainment, sports and news. Effective March 2001, each outstanding share of Disney Internet Group stock was converted into 0.19353 of a share of DIS common stock.

	2001	2000	1999	1998	1997	1996	1995	1994	1993	1992
Curr. Ratio	1.1	1.2	1.3	1.2	NA	NA	NA	NA	NA	NA
% LT Debt of Cap.	25.7	20.3	28.2	30.4	36.9	42.3	27.9	24.6	16.5	22.3
% Net Inc.of Revs.	0.5	3.6	5.6	8.1	8.7	6.5	11.4	11.0	7.9	10.9
% Ret. on Assets	0.3	2.1	3.1	4.7	5.2	4.7	10.1	9.1	5.9	8.0
% Ret. on Equity	0.5	4.1	6.4	10.1	11.8	10.7	22.7	21.3	13.7	19.0

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. Bold denotes diluted EPS (FASB 128). E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--500 S. Buena Vista St., Burbank, CA 91521. Tel--(818) 560-1000. Website--http://www.disney.com/investors Chrmn & CEO--M. D. Eisner. Pres & COO--R. A. Iger. SEVP & CFO--T. O. Staggs. VP & Secy--M. L. Reed. SVP & Investor Contact--W. M. Webb. Dirs--R. F. Bowers, J. E. Bryson, R. E. Disney, M. D. Eisner, J. Estrin, S. P. Gold, R. A. Iger, M. C. Lozano, G. J. Mitchell, T. S. Murphy, L. J. O'Donovan, S. Poitier, R. A. M. Stern, A. L. Van de Kamp, R. L. Watson, G. L. Wilson. Transfer Agent & Registrar--Co.'s office. Incorporated--in California in 1938; reincorporated in Delaware in 1987. Empl-- 114,000. S&P Analyst: Tom Graves, CFA

This report is for information purposes and should not be considered a solicitation to buy or sell any security. Neither S&P nor any other party guarantee its accuracy or make warranties regarding results from its usage. Redistribution is prohibited without written permission. Copyright © 2002