Bits & Bytes
by Jim Stevens (JimStevens@aol.com)
Burlington, VT (April 29, 1999) -- Well, it's the end of the month again and time to tune into the Bits & Bytes portfolio. Since January 7, 1999, we've tracked a group of high tech large cap "stocks everybody has to own" highfliers. Not a diversified portfolio to say the least, but sometimes in stocks it can pay to be a slave to fashion.
For new readers, the Bits & Bytes Port is selected by using the ValueLine Investment Survey for Windows. We take all the companies they list as Software, Semiconductors, Telecommunications Equipment, Computers & Peripherals, or Internet stocks. From that list of high tech names, we sort by market capitalization. The top 15 stocks make up the Workshop Bits & Bytes portfolio.
Below is how a hypothetical Bits and Bytes portfolio selected on December 31, 1999, is doing as of the April 28, 1999, market close.
Yahoo! Inc. (Nasdaq: YHOO) 46.45% America Online (NYSE: AOL) 84.37% Sun Microsystems (Nasdaq: SUNW) 43.50% EMC Corp. (NYSE: EMC) 29.71% Oracle Corp. (Nasdaq: ORCL) -5.00% Int'l Business Mach. (NYSE: IBM) 11.19% Intel Corp. (Nasdaq: INTC) 3.22% Dell Computer (Nasdaq: DELL) 13.75% Cisco Systems (Nasdaq: CSCO) 20.40% Compaq Computer (NYSE: CPQ) -43.60% Texas Instruments (NYSE: TXN) 30.66% Lucent Technologies (NYSE: LU) 10.40% Microsoft Corp. (Nasdaq: MSFT) 18.43% Motorola Inc. (NYSE: MOT) 27.12% Hewlett-Packard (NYSE: HWP) 16.10% Top 5 39.81% Top 10 20.40% Average gain/loss (all 15) 20.45%Since our last update we've seen what I've heard called "sector rotation" out of these stocks, then a rotation back to them -- and now the sector solar system seems to be rotating again. Go figure. Overall they still seem to be holding their own. Some of these companies have made so many boastful investors profit that any downturns seem just bound to draw in new money.
Here is the Bits & Bytes screen as run on the latest Value Line data. Again, it's hard not to notice how stable the list remains, it's the exact same 15 companies as it was four months ago. The stocks are listed in decreasing order of 26-week total return:
America Online 433.64% Yahoo! Inc. 192.07% Sun Microsystems 123.21% Cisco Systems 87.31% Texas Instruments 84.16% EMC Corp. 81.71% Motorola Inc. 64.49% Microsoft Corp. 54.08% Lucent Technologies 49.81% Dell Computer 35.02% Intel Corp. 34.34% Oracle Corp. 33.41% Hewlett-Packard 32.28% Int'l Business Mach. 20.79% Compaq Computer -14.44%
The always-mentioned word of caution is this: the Bits & Bytes is not a backtested screen, and it's heavily weighted with volatile stocks. Make sure you understand the risks and do your own independent examination of the companies before committing any real money.
Check out the latest file updates for the Workshop: