Boring Portfolio

<THE BORING PORTFOLIO>
TCBY Sell Announcement
Bore to Sell TCBY
The Portfolio Wrap

by Alex Schay (TMF Nexus6)

ALEXANDRIA, VA (Dec. 30, 1998) -- It's not Friday, but its as close as we're going to get before the new year. So, today we'll include a wrap up of the events that affected the portfolio during the past week, as well as a link to Dale's sell report on our fat-free friend TCBY Enterprises (NYSE: TBY). First, let's take a look at how the portfolio jumped around over the last 12 days:

     Close 12/18 12/30    %Change
ANDW $17 7/16    $16 3/16 -9.31%
BGP  $18 5/16    $24 7/8  35.84%
CSL  $45 5/16    $49 1/4   8.69%
CSCO $90 7/16    $93 1/16  2.90%
FCH  $22 1/2     $22 7/16  0.04%
PNR  $35 15/16   $37 1/8   3.19%
TBY   $6 7/8      $6 3/4   1.8%

Andrew Corp. (Nasdaq: ANDW) fell almost 10% on no news-related events. The company did recently submit its 10K to the requisite authorities, and the statement of cash flows for the year paints the picture of a company holding strong on cash from operations, keeping capital expenditures in line, and buying back shares. Generating north of $91 million in free cash flow, which was then slated for buy-backs, definitely should give investors some confidence about possible downside risk. Trading at roughly 15 times free cash flow with strong return on invested capital characteristics, this is not a holding we are concerned about losing money on right now. Of course, end user demand in 1999 is the key issue that we're going to take a look at -- in 1999!

Borders Group (NYSE: BGP) shot up about 35% over the last couple of days, perhaps on the realization that the superstores aren't going out of business anytime soon. Apparently, some investors saw value in both Borders and Barnes & Noble (NYSE: BKS) over the last two weeks (Barnes & Noble has risen 43% off its December 14th low), in a retail environment dominated by talk of the "e-tailers." The ultimate verdict on these guys will come after the fourth quarter, once the online impacts on the unit economics of these stores is taken more fully into account. There was no news on Carlisle Companies (NYSE: CSL) again this week. It's just chugging along and selling those golf cart tires and that cheese making equipment. I don't think the company received the Christmas card Dale sent.

No real news on Pentair, Inc. (NYSE: PNR) or FelCor Lodging Trust (NYSE: FCH) in the last week either. FelCor is another holding in which we need to focus on the dynamics of the overall operating environment. The company guided analysts' down on growth in revenue per available room (RevPAR) for 1999 -- to 3.5% from prior projections of anywhere between 4.0% and 4.5%. Although, this may turn out to be excess conservatism on the part of management in the face of perceived weakness in capital markets -- that's the word on the street anyway (they managed RevPAR of 5% in both October and November). We'll take a closer look.

What can we say about Cisco (Nasdaq: CSCO), except that the REITERATED "strong buy" ratings keep flowing in -- courtesy of SG Cowen this time around.

A couple of concluding thoughts for readers: we're in the home stretch of the SOS charity drive, so give until it hurts, and as usual, don't be shy about the email, send, until it hurts. That's it for today. Check out the TCBY sell report, and join us on the boards if you feel so inclined. Have a Happy New Year!


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12/30/98 Close
Stock  Change    Bid
ANDW  -  5/16  16.31
BGP   +  1/16  25.00
CSL   +  9/16  49.50
CSCO  -  13/16 92.69
FCH   +  1/2   22.50
PNR   -  11/16 37.25
TBY   +  3/16  6.75

                   Day   Month    Year  History
        BORING    0.00%   7.47%   5.25%  32.43%
        S&P:     -0.79%   5.87%  26.95%  98.18%
        NASDAQ:  -0.68%  11.15%  37.99% 108.17%

    Rec'd   #  Security     In At       Now    Change
  6/26/96  225 Cisco Syst    23.96     92.69   286.92%
  2/28/96  400 Borders Gr    11.26     25.00   122.10%
  8/13/96  200 Carlisle C    26.32     49.50    88.03%
  4/14/98  100 Pentair       43.74     37.25   -14.84%
  5/20/98  400 TCBY Enter    10.05      6.75   -32.80%
  1/21/98  200 Andrew Cor    26.09     16.31   -37.48%
  11/6/97  200 FelCor Sui    37.59     22.50   -40.14%

    Rec'd   #  Security     In At     Value    Change
  6/26/96  225 Cisco Syst  5389.99  20854.69 $15464.70
  2/28/96  400 Borders Gr  4502.49  10000.00  $5497.51
  8/13/96  200 Carlisle C  5264.99   9900.00  $4635.01
  4/14/98  100 Pentair     4374.25   3725.00  -$649.25
  5/20/98  400 TCBY Enter  4018.00   2700.00 -$1318.00
  1/21/98  200 Andrew Cor  5218.00   3262.50 -$1955.50
  11/6/97  200 FelCor Sui  7518.00   4500.00 -$3018.00

                             CASH  $11273.22
                            TOTAL  $66215.40

</THE BORING PORTFOLIO>