Boring Portfolio

Boring Portfolio Report
Friday, April 18, 1997
by Greg Markus (TMF Boring)


ANN ARBOR, Mich. (April 18, 1997) -- Major market averages all rose Friday, with the Dow and S&P 500 each up around two-thirds of a percent.

The Nasdaq gained 5.5 points (+0.45%), but a good chunk of that was MICROSOFT (Nasdaq: MSFT), which zoomed $9 1/2 following a super-duper earnings report Thursday night. After opening 15 points above Thursday's close, the Nasdaq drifted steadily lower, and the numbers of daily gainers and losers were virtually tied.

Among the losers was CISCO SYSTEMS (Nasdaq: CSCO), which fell a dollar. The company and its CEO, John Chambers, are the focus of a not particularly flattering article in the current issue of Business Week. For those of you who may not have the time or interest to read the entire BizWeek article, I've provided a somewhat abridged version below:

"Crunch time... nightmares... growth engine sputtering... routers running out of gas... late to market... scrappy challengers... competition bulking up... Cisco caught napping... sweeping change... sales may be slipping... sell-off in networking stocks... rival Ipsilon Networks... Cisco flat-footed... IP switches... BFR behind schedule... Cisco IOS more hype than help... Intel... put entire routing function on a chip... And Microsoft... Steelhead... warning... rough waters... job won't be easy... crunch times."

And a modest reply:

Always crunch time... no nightmares... no sputter... lots of gas... dominates the market... scrapped challengers... Cisco bulking up... Kid never sleeps... always sweeping change... Cisco led... sales 30% to 50% 'til millennium... buying opportunity?... tag switching... RSVP... QoS... BFR in '97... new access server, too... IOS rules... Intel partner... Microsoft partner... lotsa partners... always rough waters... job never easy... always crunch times.

GREEN TREE FINANCIAL (NYSE: GNT) held at $32 5/8. The Motley Fool offers a synopsis of Green Tree's conference call, which followed the company's earnings report Thursday.

Shares of CARLISLE COMPANIES (NYSE: CSL) rose another $1/4 following the company's report Thursday of its first quarter results. Earnings per share rose 23% to $0.43 -- two cents above the consensus of analysts. Sales rose 28%, to $287.8 million.

Carlisle doesn't get a lot of face time here in the Borefolio recaps. As you may (or may not) recall, Carlisle is a diversified manufacturer of products serving three major markets: construction materials, transportation products, and general industry. The first segment includes stuff like rubber roofing material, tapes and adhesives. The second includes everything from plastic auto parts to truck trailers to aircraft wiring, while "general industry" encompasses foodservice products (airline meal trays, melamine dinnerware, cheese-making equipment), stainless steel containers, and tires for lawn tractors, boat trailers, and such.

I know: boring.

Yesterday's Boring recap summarized Carlisle's overall results for the quarter -- which nicely topped analysts' expectations. Today, I offer a bit more color on the results, by business segment.

Revenues in Carlisle's construction segment were up 8% over a year ago, after accounting for the sale of Carlisle's engineered metal roofing business in February 1997. Segment operating earnings increased 31% due to reduced raw material costs, a mix of sales that tilted toward higher margin products, and internal productivity improvements. Revenues in the transportation segment rose 48% and earnings increased 36%, helped partly by a recent acquisition. In the general industry segment, sales rose 26% and operating earnings 29%.

The company appears to me to be solidly on track to grow EPS at a rate in the upper teens for 1997, to around $2.10 for the year.

Finally, ATLAS AIR (Nasdaq: ATLS) descended $1/8 in relatively light trading. The company releases its quarterly results on Thursday. Perhaps we'll hear more from Atlas founder and chairman Michael Chowdry regarding the possibility that his company might order a fleet of brand new BOEING (NYSE: BA) 747-400 freighters.

For the week, the Borefolio gained 1.38% -- a bit better than the Nasdaq but far behind the S&P 500. Here's hoping that next week provides even better results -- for the Borefolio and, especially, for you.

Have a great week-end!


(c) Copyright 1997, The Motley Fool. All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without the prior written consent of The Motley Fool.


TODAY'S NUMBERS
Stock  Change    Bid
ATLS  -  1/8   25.38
BGP   -  1/8   21.00
CSL   +  1/4   28.50
CSCO  -1       48.38
GNT   -  1/4   32.63
ORCL  +  1/8   37.13
OXHP  -2 1/8   60.25
PMSI  -  1/8   9.00
TDW   +1 1/4   45.38
                   Day   Month    Year  History
        BORING   -0.53%  -0.10%  -4.75%   9.61%
        S&P:     +0.60%   1.22%   3.46%  23.28%
        NASDAQ:  +0.45%   0.07%  -5.30%  17.45%

    Rec'd   #  Security     In At       Now    Change
  2/28/96  400 Borders Gr    11.26     21.00    86.56%
  5/24/96  100 Oxford Hea    48.02     60.25    25.46%
   3/5/97  150 Atlas Air     23.06     25.38    10.05%
  8/13/96  200 Carlisle C    26.32     28.50     8.26%
   2/2/96  200 Green Tree    30.39     32.63     7.36%
  6/26/96  100 Cisco Syst    53.90     48.38   -10.25%
   3/8/96  400 Prime Medi    10.07      9.00   -10.61%
 11/21/96  100 Oracle Cor    48.65     37.13   -23.69%
 12/23/96  100 Tidewater     46.52     45.38    -2.47%

    Rec'd   #  Security     In At     Value    Change
  2/28/96  400 Borders Gr  4502.49   8400.00  $3897.51
  5/24/96  100 Oxford Hea  4802.49   6025.00  $1222.51
   2/2/96  200 Green Tree  6077.49   6525.00   $447.51
  8/13/96  200 Carlisle C  5264.99   5700.00   $435.01
   3/5/97  150 Atlas Air   3458.74   3806.25   $347.51
   3/8/96  400 Prime Medi  4027.49   3600.00  -$427.49
  6/26/96  100 Cisco Syst  5389.99   4837.50  -$552.49
 11/21/96  100 Oracle Cor  4864.99   3712.50 -$1152.49
 12/23/96  100 Tidewater   4652.49   4537.50  -$114.99
CASH $7660.41 TOTAL $54804.16