Boring Portfolio

Boring Portfolio Report
Thursday, February 13, 1997
by Greg Markus (MF Boring)

ANN ARBOR, Mich. (Feb. 13, 1997) -- The Dow Jones Industrial Average tacked on 61 points Thursday to blow through the 7,000 mark and establish a new high at 7022.82. The S&P 500 pushed into uncharted territory, as well, gaining 9 points, or 1.13%, to close at 811.82. On any other day, the Nasdaq's 12-point advance on volume well in excess of 700 million shares would have commanded attention. Today, it was no big deal.

On the Boring front, six holdings advanced and three declined, yielding a net gain of $987.50, or 1.65%. In keeping with the celebrations on Wall Street, the Boring Portfolio established a new high of its own: $60,924.08 -- plus a few bucks in accumulated dividends and interest that we'll add into the spreadsheet as soon as we get a chance.

The Borefolio's still got a way to go to catch the percentage gains in the benchmark indexes, but it's heading in the right direction once again. Investing that 10% of assets that remains sitting in cash might help, right?

Right. Workin' on it, boss.

CISCO SYSTEMS (Nasdaq: CSCO) gave back half of the $4 (bid-side) it gained yesterday. SOLECTRON (NYSE: SLR) eased $1/8 after Wednesday's sharp gain, as well. "Profit-taking," as they say?

Our other Silicon Valley resident, ORACLE (Nasdaq: ORCL), slipped $1/8. Oracle issued a press release today directing attention to a new publication called Profit: The Oracle Applications Magazine. The quarterly magazine just completed a two-issue shakedown cruise and is to be launched onto newsstands this month.

According to Oracle, Profit will not be "a traditional technology magazine that preaches technology for technology's sake" but instead will cover technology from the perspective of business people interested in maximizing the return on their technology investments.

The new issue features interviews with Jack Robinson, Sara Lee Bakery's president of specialty markets, and Bill Phelan, FTD's vice president of technology. Profit's readers "will also get tips on how to hone their golf game and apply the principles of golf to their business investments" in a column called "Hitting the Greens" by Mike Snider, of USA Today.

Editor Julie Gibbs says she hopes to have 20,000 subscribers by June.

Paid subscribers? Is it just me, or does this magazine sound too boring even for Boring?

Moving on to the upside stuff, GREEN TREE FINANCIAL (NYSE: GNT) blossomed $1 7/8 on above-average trading volume today. Now that some of the undergrowth of sub-prime lenders has been cleared away, it appears that this sturdy financial services company is once again attracting attention.

In the past week, the consensus earnings estimate for Green Tree's March quarter rose a penny, to $0.63, according to First Call. The stock's consensus rating rose a tick, as well -- to 1.4 ("strong buy") from 1.5. Even after today's move, GNT is trading at less than 14-times projected 1997 EPS of $3.00. Yet per-share earnings are expected to advance 30% this year and around 20% or so longer-term.

OXFORD HEALTH PLANS (Nasdaq: OXHP) zoomed ahead $3-3/8, on top of yesterday's $3-3/4 spurt. OXHP was among a number of healthcare stocks that rallied following upbeat comments to analysts in connection with this morning's earnings report by UNITED HEALTHCARE (NYSE: UNH), the nation's largest HMO company.

Oxford Health reports its results on Tuesday, and The Motley Fool will cover the follow-up conference call.

Speaking of conference calls, a summary of the CARLISLE (NYSE: CSL) teleconference is available in our Earnings Central area. Yesterday, Carlisle gained $1-1/2 -- and in case anyone hadn't noticed, it repeated the feat today, to close at a record high of $35-1/8. Not only that, Carlisle's trading volume of 156,000 shares on Thursday was more than the stock sees in a typical week.

Shares of TIDEWATER (NYSE: TDW) continued to roll ahead as well, gaining $1-3/8.

I see that yesterday an analyst at NatWest advised investors to avoid stocks of U.S. oil service companies. On the other hand, a Motley Fool participant known by the screen-name TEXEAKIN posted a few days ago that, "This is not the time to sell. This is the time to buy."

Tex noted that "the momentary price of oil and gas, as well as the weather, can have a substantial short-term impact on the prices of these shares, but sell-offs such as Tidewater is experiencing are irrational and thus represent buying opportunities."

He continued, "I spent a few days last week with some folks from the supply boat industry, and they tell me that not one thing has fundamentally changed. Rates continue to rise (though they now approach levels at which new construction is feasible), and Tidewater in particular has lots of long-term leases at the high rates."

"Tidewater has a dominant share of the market -- and can thus shift its fleet around the world to balance supply and demand in specific markets. North Sea and West Africa day rates are moving up fast, and things look solid for the coming years. The Gulf of Mexico deep water investments by the major oil companies are long-term in nature, the world demand for oil continues to rise, and there will be a sustained strong demand for supply boats."

I'm passing along TEXEAKIN's comments because I think they are at least as authoritative as those offered by NatWest. If nothing else, Tex's comments comport well with what I heard Tidewater executives say in a recent conference call (a summary of which is also available at The Motley Fool's Earnings Central), as well as with what the company said when I talked with a spokesman there a few days ago.

(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   43.50
CSL   +1 1/2   35.13
CSCO  -2       62.50
GNT   +1 7/8   41.13
ORCL  -  1/8   41.25
OXHP  +3 3/8   59.25
PMSI  +  1/8   11.50
SLR   -  1/4   56.13
TDW   +1 3/8   44.63
                    Day   Month    Year  History
        BORING   +1.65%   5.89%   5.89%  21.85%
        S&P:     +1.13%   9.60%   9.60%  30.60%
        NASDAQ:  +0.87%   6.18%   6.18%  31.69%

    Rec'd   #  Security     In At       Now    Change

  2/28/96  200 Borders Gr    22.51     43.50    93.23%
   2/2/96  200 Green Tree    30.39     41.13    35.34%
  8/13/96  200 Carlisle C    26.32     35.13    33.43%
  5/24/96  100 Oxford Hea    48.02     59.25    23.37%
  6/26/96  100 Cisco Syst    53.90     62.50    15.96%
   3/8/96  400 Prime Medi    10.07     11.50    14.22%
 10/15/96  100 Solectron     54.52     56.13     2.93%
 12/23/96  100 Tidewater     46.52     44.63    -4.08%
 11/21/96  100 Oracle Cor    48.65     41.25   -15.21%

    Rec'd   #  Security     In At     Value    Change

  2/28/96  200 Borders Gr  4502.49   8700.00  $4197.51
   2/2/96  200 Green Tree  6077.49   8225.00  $2147.51
  8/13/96  200 Carlisle C  5264.99   7025.00  $1760.01
  5/24/96  100 Oxford Hea  4802.49   5925.00  $1122.51
  6/26/96  100 Cisco Syst  5389.99   6250.00   $860.01
   3/8/96  400 Prime Medi  4027.49   4600.00   $572.51
 10/15/96  100 Solectron   5452.49   5612.50   $160.01
 12/23/96  100 Tidewater   4652.49   4462.50  -$189.99
 11/21/96  100 Oracle Cor  4864.99   4125.00  -$739.99

                             CASH   $5999.08
                            TOTAL  $60924.08