Boring Portfolio

Boring Portfolio Report
Thursday, February 6, 1997
by Greg Markus (MF Boring)

ANN ARBOR, Mich. (Feb. 6, 1997) -- The Dow rose 26 points and the S&P 500 gained 2 (0.24%) on Thursday. The Nasdaq Composite continued lower, however, hurt by a continuing sell-off in shares of Intel Corp. (Nasdaq: INTC).

February continues to eat away at the Boring Portfolio's January gains. The Borefolio shed a half percentage-point in net asset value today, as five holdings declined, three advanced, and one -- PRIME MEDICAL SERVICES (Nasdaq: PMSI) remained unchanged, at a bid of $11 5/8.

CISCO SYSTEMS (Nasdaq: CSCO) recovered a dollar of yesterday's losses. Following his keynote address to networkers attending the ComNet '97 Conference in Washington, D.C. today, Cisco CEO John Chambers affirmed his expectation that the networking industry will grow by 30 to 50 percent in 1997. "It's only a question of whether it's going to be (closer to) 30 percent or 50 percent. It isn't a question of whether it's going to be in that range," Chambers said, according to a Reuters report. Chambers also reiterated that Cisco aims to outperform the overall market's annual rate of revenue growth.

In other Cisco news, the company announced that Carol Bartz, president, CEO and chairman of Autodesk, Inc. (Nasdaq: ADSK), rejoins Cisco's board of directors "after a brief hiatus." Bartz became president of Autodesk, a leader in computer-aided design (CAD) software, in April 1992. Prior to that, she held positions at Sun Microsystems (Nasdaq: SUNW), serving as vice president of worldwide field operations and as an executive officer.

OXFORD HEALTH PLANS (Nasdaq: OXHP) stock has not been the picture of health recently. Oxford fell $2 1/8 today, possibly in reaction to a sub-par earnings report issued yesterday by next-door neighbor Aetna (NYSE: AET).

For much of 1996, Oxford's share price suffered -- undeservedly, as it turned out -- as one HMO after another reported sub-par earnings owing primarily to their misguided strategy of trying to steal market share with low-ball pricing.

So far in 1997, HMO stocks, have continued to droop following news that the Clinton Administration proposes to trim reimbursements to HMOs that enroll Medicare recipients. The President proposes, but Congress disposes; and so far, the Congressional reaction that this particular proposal has been distinctly cool.

As for Aetna's problems, there is no particular reason to believe that Oxford shares them. Aetna is struggling to integrate US Healthcare into its fold following last year's acquisition. To the best of my knowledge, no analysts have revised their earnings estimates for Oxford, nor has the company issued any cautions.

Oxford will report its fourth quarter and fiscal 1996 results on Feb. 18. Analysts are forecasting quarterly earnings of $0.38 per share, which would constitute a stunning 71% increase over the year-ago quarter.

Oxford has already expressed its comfort with analysts' estimates, so it's unlikely that there will be any downside surprise. Much more diagnostic will be what the company has to say about the coming year. In the past, Oxford's quarterly conference calls have had the air of a scholarly seminar on the state of healthcare provision in the U.S., as CEO Stephen Wiggins demonstrates his mastery of the subject. I look forward to hearing what Wiggins has to say this time around -- and reporting back to you.

Speaking of which, last night, CARLISLE COMPANIES (NYSE: CSL) reported its fourth quarter and annual results for 1996. The company earned $0.42 per share, topping analysts' expectations, as listed in First Call, by two cents. The post-report conference call took place today, and my summary will be available here in The Motley Fool tomorrow.

In a nutshell, there are no surprises coming from Carlisle. Company spokesmen said that they would have to really foul up not to be able to grow earnings at least 15% next year, and they anticipate good growth from all three business divisions. CSL rose $ 3/8 to $28 7/8 today.

(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
BGP   -  1/8   41.63
CSL   +  3/8   29.88
CSCO  +1       63.88
GNT   -1       40.25
ORCL  +  7/8   39.38
OXHP  -2 1/8   49.38
PMSI  ---      11.63
SLR   -  1/2   55.75
TDW   -1       43.63

                  Day   Month    Year  History
        BORING   -0.56%   1.15%   1.15%  16.40%
        S&P:     +0.24%   5.32%   5.32%  25.50%
        NASDAQ:  -0.15%   4.29%   4.29%  29.34%

    Rec'd   #  Security     In At       Now    Change

  2/28/96  200 Borders Gr    22.51     41.63    84.90%
   2/2/96  200 Green Tree    30.39     40.25    32.46%
  6/26/96  100 Cisco Syst    53.90     63.88    18.51%
   3/8/96  400 Prime Medi    10.07     11.63    15.46%
  8/13/96  200 Carlisle C    26.32     29.88    13.49%
  5/24/96  100 Oxford Hea    48.02     49.38     2.81%
 10/15/96  100 Solectron     54.52     55.75     2.25%
 12/23/96  100 Tidewater     46.52     43.63    -6.23%
 11/21/96  100 Oracle Cor    48.65     39.38   -19.06%

    Rec'd   #  Security     In At     Value    Change

  2/28/96  200 Borders Gr  4502.49   8325.00  $3822.51
   2/2/96  200 Green Tree  6077.49   8050.00  $1972.51
  6/26/96  100 Cisco Syst  5389.99   6387.50   $997.51
  8/13/96  200 Carlisle C  5264.99   5975.00   $710.01
   3/8/96  400 Prime Medi  4027.49   4650.00   $622.51
  5/24/96  100 Oxford Hea  4802.49   4937.50   $135.01
 10/15/96  100 Solectron   5452.49   5575.00   $122.51
 12/23/96  100 Tidewater   4652.49   4362.50  -$289.99
 11/21/96  100 Oracle Cor  4864.99   3937.50  -$927.49

                             CASH   $5999.08
                            TOTAL  $58199.08
transmitted February 06, 1997