Euro Disney (EDLP) shares soared more than 12 percent

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PARIS, June 5 (Reuters) - Shares in French theme park operator Euro Disney (EDLP) soared more than 12 percent in heavy volume on Tuesday after what analysts said looked like a big buy from a single house.

The volatile stock, which broke through the symbolic one euro ceiling on Friday for the first time in 18 months, roared to a new year high of 1.16 euros on Tuesday before easing.


At 1002 GMT it was up 5.83 percent at 1.10 euros, outperforming the European cyclical goods and services index (SX2P) that was up 0.08 percent at the time.

Tuesday's gains, which follow recent marketing by the company in the run-up to the opening of its second theme park slated for spring 2002, extended Friday's rally when the stock gained 6.19 percent. The Paris market was closed on Monday.

"There must be a big buyer -- at least seven million shares have changed hands this morning," said one analyst who declined to be named, but who has a "buy" recommendation on the stock.

"It could be a single fund group," added another at a major French bank. Still another thought a U.S. buyer was probable.

Trading volumes were heavy -- more than eight million shares changed hands in the morning after six million on Friday.

"We are one year away from the opening of the second park and when it opens that will be the biggest news in the company's history -- investors will get a big uplift if it goes right," said one analyst, who has a 1.2 euro target for the shares.

Euro Disney is building a second theme park beside its existing "Magic Kingdom" just outside of Paris. The move mirrors the strategy of leading shareholder the Walt Disney Company (DIS) in clustering several parks together to encourage visitors to stay for longer at the site. Another analyst said Euro Disney, which suffered a severe financial crisis after the construction of the first Magic Kingdom park, may at last be putting its troubles behind it.

But the lack of liquitidy -- parent the Walt Disney Company holds 39.1 percent and Prince Al-Walid had 17.3 percent as of September, leaving 43.6 percent in public hands -- means investors still regard the stock as a risky bet.
 

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