Start Chewing on Wrigley

by Jeff Fischer (TMF Jeff)

ALEXANDRIA, VA (August 20, 1999) -- It is a rare day when you can write a column about a company without first researching and thinking about the company, its industry, and its competition. Today is not a rare day. Time was spent researching Wrigley (NYSE: WWY), even though the writing about Wrigley will not begin until next week at the earliest. There are many ways that you, as a Fool, can prepare at home.

The first may be the best: visit Wrigley's website. Fascinating is not too strong a word for the site and its content. The Wrigley site provides details about the company's history (it was founded on April 1, 1891 -- April Fool's Day), the history of gum, how gum is made, what gum is made of, what happens when gum gets on your shoe, and -- most useful to Brian -- how to get gum out of your hair.

Wrigley began to trade on the public market in 1919, the same year as Coca-Cola (NYSE: KO). This of course means that, for kicks and then some, we'll determine the relative performance of each stock when I write about Wrigley next. It shouldn't be too difficult to determine which company stepped on the other: Coca-Cola has a market capitalization of $145 billion and Wrigley's is $6.9 billion. The "buy any great brand-name company and all will be groovy" strategy may be true in many cases, but it is certainly true to greatly varying degrees.

If you believe you might be interested in investing in Wrigley for the next few decades (obviously a serious commitment, no less serious than buying a puppy), visit the website and read through it this weekend or next week. It is arranged very well and it doesn't waste words. Most all of it is useful, from the frequently asked questions area, to "The Story of Chewing Gum," to, of course, the financial data. In fact, I spent much of the day reading the website aloud to Brian, because -- few people know this -- he is completely illiterate. (His columns are typed by an overly supportive friend.)

After browsing the Wrigley website, return here and read (or re-read) Brian's most recent (ghost-written) column detailing Wrigley, originally titled, "Chewing on Wrigley." (Yeah, so I stole his title for today's column. Oh, the wit of finance writers.)

Finally, I'm certain that we can all breathe life into the Wrigley message board before our study is finished. Now read, read, read. And if you have gum, chew, chew, chew while you read. If you can't read, like Brian, just chew gum until you get some in your hair -- like Brian.

To close, interesting Johnson & Johnson (NYSE: JNJ) news may have helped the shares move higher. Read about it in Fool News. Also, the FDA gave Aciphex marketing clearance. J&J is involved.

Drip Portfolio

8/20/99 Closing Numbers
 Ticker   Company   Dly Pr Chg   Price 
CPB  CAMPBELL SOUP                1/4   $44.31
INTC  INTEL CORP                   5/8   $79.94
JNJ  JOHNSON & JOHNSON            1/8   $98.94
MEL  MELLON BANK CORP             1/8   $34.63

  Day Week Month Year
To Date
DRiP 3.04% .94% 9.26% 15.01% 30.80% 13.89%
S&P 500 .98% .67% .59% 8.74% 42.38% 18.67%
S&P 500(DA) .97% .66% .58% 9.18% 45.00% 19.72%
S&P 500(DCA) n/a n/a n/a n/a 24.61% 11.25%
NASDAQ 1.03% .50% .37% 20.78% 68.73% 28.84%

 Trade Date   # Shares   Ticker   Cost/Share   Price   LT % Val Chg 
  9/8/97  19.4789INTC    40.907  $79.94  95.41%
  11/14/97  9.076JNJ    76.563  $98.94  29.22%
  11/5/98  22.4534MEL    34.156  $34.63  1.37%
  4/13/98  8.134CPB    54.638  $44.31  -18.90%

 Trade Date   # Shares   Ticker   Cost   Value   LT $ Val Ch 
  9/8/97  19.4789INTC    $796.82  $1,557.10  $760.28
  11/14/97  9.076JNJ    $694.89  $897.96  $203.07
  11/5/98  22.4534MEL    $766.91  $777.45  $10.54
  4/13/98  8.134CPB    $444.42  $360.44  ($83.98)
  Cash: $24.33  
  Total: $3,617.27  

• S&P 500 (DA) = dividend adjusted. Dividends have been added to the total return of the index.

Drip Port launched with $500 on July 28, 1997, adds $100 to invest every month, and the goal is to own $150,000 in stock by August of the year 2017. Due to the slow nature of dollar-cost-averaging and our relatively significant starting costs, we do not expect to seriously challenge the S&P 500 for the first three to five years as we build an investment base. The long-term advantages of dollar-cost-averaging still overcome the short-term disadvantages, however. Final note: our investment in Campbell Soup is frozen due to fees instituted in its investment plan. Click here for a history of all Drip Port transactions.