Monday, May 4, 1998
Cash-King Portfolio
Report
by Phil Weiss
([email protected])
Towaco, NJ (May 4, 1998) -- Its Monday once again. I hope that you enjoyed your weekend, spending a goodly number of hours away from all things work related. To get back in the groove, as is our custom on Mondays, Ill be talking about the news surrounding our portfolio holdings last week. First well review the numbers:
Cash-King Last This Change Coca-Cola $73.63 $76.19 + 3.5% Intel $82.00 $82.06 + 0.1% Microsoft $92.06 $89.63 - 2.6% T R Price $38.19 $36.75 - 3.8% Pfizer $117.63$112.75 - 4.1% Gap* N/A $51.06 N/A Fool Four Last This Change Chevron $82.44 $86.38 + 4.8% Exxon $73.50 $75.63 + 2.9% E Kodak $72.19 $73.38 + 1.6% GM $67.50 $68.56 + 1.6% S&P 500 1107.90 1121.02 + 1.2% Total CK $21,827 $21,793 - 0.2% * Purchased Friday, 05/01/98
Ugh! Not a pretty picture. Last week offered a good reason for us to continue focusing on the long term! The other thing that last week showed is why its nice to have our Fool Four holdings as ballast in our portfolio. The performance for the week would have been a lot worse if all four of these stocks hadnt outperformed the S&P. Only one of our Cash-Kings had a market-beating week.
Okay, lets get on to the news of the week. Well start with our big winner of the week -- Coca-Cola (NYSE: KO). This is an easy one, it was up on no news.
As always seems to be the case these days, Pfizer (NYSE: PFE) appeared in the news several times last week. On Monday it was announced that the second week of Viagra sales resulted in 113,134 new prescriptions. Tuesday brought news (Viagra and Women) that some women have been asking for prescriptions for Viagra for their own use; however, the FDA has not approved this use at this time. On Wednesday, the New York insurance department said it is asking the state's health insurers for information about whether they are going to provide coverage for Viagra and the justification for their decision. Several large insurers are adopting strict reimbursement policies for Viagra, requiring proof of a medical cause for the problem and limiting the number of pills covered, according to a New York Times report.
Pfizer also received additional coverage in the May 11 editions of both Fortune and Business Week. The Fortune article discusses the reasons behind the companys success and why they expect that it will continue for years to come. Business Weeks cover story this week is about the "New Era of Lifestyle Drugs" and how Viagra and other blockbusters are transforming the $300 billion drug industry. Both articles are interesting reads for those who follow pharmaceuticals in general and Pfizer in particular. This is just another example of all the free publicity that Pfizer has been receiving lately. As a shareholder, thats always great to see.
Next up is our company that seems to always be in the news these days Microsoft (Nasdaq: MSFT). Many expect that the federal government and some states could file coordinated new anti-trust charges against Softy as early as next week. As a matter of fact, Connecticut Attorney General Richard Blumenthal told the New York Times, The decision on our action is imminent, and in my opinion some action is likely. I think it will be in the next couple of weeks.
Mr. Softy answered back by releasing a letter late Thursday signed by the heads of 26 computer software, hardware, and retail outlets asking anti-trust chief Joel Klein not to delay the release of Windows 98. Microsoft Corp. has settled on June 25 as the formal delivery date for Windows 98, and according to the software giant it will take "a far more radical step" than a dozen State Attorneys General seeking an injunction to stop the release of the new operating system.
Next up, appearing for the first time in one of these reports is our newest portfolio holding Gap Inc. (NYSE: GPS). The biggest news Im aware of on this one last week is our buy announcement. In case you missed it, click on this link (Gap Buy Report) to find out why we decided to add this fine filly to our portfolio.
The only news on T. Rowe Price (Nasdaq: TROW) was that its 2-for-1 stock split was effective on Friday. The stocks performance for the week, and Friday in particular, just goes to show that stocks dont always go up in price immediately before and after they split.
Last up is Intel (Nasdaq: INTC). The biggest news for the week was probably on Thursday when one of our Fool 4 holdings -- Eastman Kodak (NYSE: EK) and Intel announced a series of agreements to promote pictures and digital Imaging. For more information you can check out this Web link: C-Ks Partner Up.
Also, late Monday, Intel said its new Celeron line of computer chips for low-cost PCs was gaining market share and would turn a profit. Early sales are robust. We have essentially every PC manufacturer as a Celeron customer and they have all announced plans to deliver this product, Pat Gelsinger, general manager of Intel's Business Platform Group, told Reuters in an interview.
Thats it for the weekly news recap. Were going to spend the next couple of days going over some thoughts on how to determine whether or not a bank is a Cash-King or not. We'll also be announcing our 7th Cash-King purchase this week.
Have a Foolish evening,
Phil Weiss
TODAY'S
NUMBERS
Stock Change Bid ---------------- CHV - 22/63 86.03 KO + 1/16 76.25 GPS + 1/16 51.13 EK +2 5/8 76.00 XON - 7/8 74.75 GM +1 5/16 69.88 INTC - 1/8 81.94 MSFT -1 5/8 88.00 PFE - 1/16 112.69 TROW - 3/4 36.00 |
Day Month Year History
C-K -0.13% 0.33% 8.82% 8.82%
S&P: +0.09% 0.93% 12.06% 12.06%
NASDAQ: +0.20% 0.47% 13.57% 13.57%
Cash-King Stocks
Rec'd # Security In At Now Change
2/3/98 22 Pfizer 82.30 112.69 36.92%
2/3/98 24 Microsoft 78.27 88.00 12.43%
2/27/98 27 Coca-Cola 69.11 76.25 10.34%
2/6/98 56 T. Rowe Pr 33.67 36.00 6.91%
5/1/98 37 Gap Inc. 51.09 51.13 0.07%
2/13/98 22 Intel 84.67 81.94 -3.23%
Foolish Four Stocks
Rec'd # Security In At Value Change
3/12/98 20 Eastman Ko 63.15 76.00 20.35%
3/12/98 20 Exxon 64.34 74.75 16.19%
3/12/98 15 Chevron 83.34 86.03 3.22%
3/12/98 17 General Mo 72.41 69.88 -3.49%
Cash-King Stocks
Rec'd # Security In At Value Change
2/3/98 22 Pfizer 1810.58 2479.13 $668.55
2/3/98 24 Microsoft 1878.45 2112.00 $233.55
2/27/98 27 Coca-Cola 1865.89 2058.75 $192.86
2/6/98 56 T. Rowe Pr 1885.70 2016.00 $130.30
5/1/98 37 Gap Inc. 1890.33 1891.63 $1.30
2/13/98 22 Intel 1862.83 1802.63 -$60.20
Foolish Four Stocks
Rec'd # Security In At Value Change
3/12/98 20 Eastman Ko 1262.95 1520.00 $257.05
3/12/98 20 Exxon 1286.70 1495.00 $208.30
3/12/98 15 Chevron 1250.14 1290.39 $40.25
3/12/98 17 General Mo 1230.89 1187.88 -$43.02
CASH $3910.83
TOTAL $21764.22
*The year for the S&P and Nasdaq will be as of 02/03/98
