Boring Portfolio

Boring Portfolio Report
Monday, September 15, 1997
by Mark Weaver, MD (mweav)


St. Louis, MO (Sept. 15, 1997) - After a strong rally this morning all of the major market indices fell later in the day. The putative culprit was MICROSOFT (Nasdaq: MSFT) which announced there would be a delay in the latest Windows upgrade, Windows 98. It's deja vu all over again. I seem to recall delays ad nauseum with Windows 95 and, suffice it to say, Microsoft survived those delays in good order. Technology stocks sold off on this news.

The Borefolio closed down 0.29% while the S&P and the Nasdaq were down 0.45% and 0.87% respectively. Boring losers outpaced gainers 5 to 4.

On Friday Greg took on Fool Portfolio holding AMAZON.COM (Nasdaq: AMZN) in his recap. If you haven't read it, it is interesting reading. (I make no correlation between that report and the ugly action in Amazon stock, down $7 1/8.)

This point-counterpoint between the two Foolish portfolios appears to have spread to other venues. Off of the Dow Jones News Wire I get the story of Fool Portfolio holding 3COM (Nasdaq: COMS) talking trash about Borefolio holding CISCO SYSTEMS (Nasdaq: CSCO).

While announcing a new networking switch COMS noted that it was four times faster than Cisco's current offering. Cisco countered that it will soon match or exceed this offering. The 3COM spokesman stated that it was 6 to 9 months ahead of Cisco in technology that will integrate routers and switches. He said, she said...

Then the gloves really came off. Ron Sege, a 3COM Sr. Vice President compared Cisco to IBM back in the early days of the PC. Hurling the most vicious of insults he was quoted as saying "We would say that the Cisco router is fundamentally a mainframe." OUCH!!

Thomas Downey, a Cisco director of marketing countered with a denial. "We've been in ASICs forever" he said. He said that competitors were trying to get a piece of Cisco's huge lead in the router market. Take that!!

Then Mr. Sege really got ugly. He felt that Cisco was in danger of compromising older products by the introduction of cheaper gear. "They are worried about eating their own children." OUCH!!

Finally, the article closed with the perspective of Soni Jiandani, another Cisco director. While 3COM's new Corebuilder product may well be impressive, it still can't do everything that routers need to do. "We are expanding on the router technology with products that don't just offer the speeds and feeds of switching, but retain multiple services." Take that, you may be faster but we can do more!

My take on this banter is that there is plenty of work out there for both companies. At one time or another either company may have the edge, but both companies will be there at the end of the day. In the meantime I'll take the big guy, thank you very much. Greg reports that Cisco IR communicated with him that Cisco had not changed it's guidance for upcoming earnings.

With the continued troubles of ASCEND COMMUNICATIONS (Nasdaq: ASND), networking stocks continued to struggle. Cisco closed down $2 1/2. Down but not out, I'd wager.

ORACLE CORP. (Nasdaq: ORCL) had no fewer than 12 press releases today, but even that couldn't buoy the stock. Oracle closed down $11/16.

Oracle's announcements included new software to allow companies to synchronize global supply chains and manage high volume manufacturing operations over the Web. The company also announced a plan to help makers of Oracle based solutions with increased support. Friends helping friends...

OXFORD HEALTH PLANS (Nasdaq: OXHP) announced that it is partnering with Lenox Hill Hospital and its PHO to provide cardiac care and obstetrical services to Oxford enrollees. These relationships are part of Oxford's Specialty Management model and are designed to increase the quality of specialty care. Oxford was down $1 15/16 today.

TIDEWATER (NYSE: TDW) was up $1 7/16 as the entire oil-services sector continues on a major roll. There was no company specific news to report.

Finally there was another general news items of note. Strike a blow for the easy way to lose weight as diet drugs Fen-Phen and Redux were pulled from the market because of adverse heart effects. Once again it is certified that there is no free lunch. Weight loss is back to being managed the old fashioned way, diet and exercise. Boring.

So, while investor's profits were trimmed, it became more difficult to trim off that weight. Mondays are the pits.

Drip Portfolio -- Mesage boards.
The Fool Portfolio -- Fool Port getting closer.
Fool Message Boards -- Speak your mind!
Evening News -- All the news, early.
Daily Double
-- Doubled. Why? Learn.
Daily Trouble -- Slammed. A value?
Fool Four -- 23% annualized historically


TODAY'S NUMBERS
Stock  Change    Bid
ATLS  ---      26.00
BGP   +  5/16  27.06
CSL   -1 1/16  43.44
CSCO  -2 11/16  69.63
GNT   +1       45.19
ORCL  -  5/8   38.00
OXHP  -1 13/16  76.00
PMSI  +  3/16  14.38
TDW   +1 7/16  59.81
                   Day   Month    Year  History
        BORING   -0.29%   3.38%  25.72%  44.67%
        S&P:     -0.45%   2.26%  24.17%  47.96%
        NASDAQ:  -0.87%   3.00%  26.64%  57.06%

    Rec'd   #  Security     In At       Now    Change
  2/28/96  400 Borders Gr    11.26     27.06   140.42%
  8/13/96  200 Carlisle C    26.32     43.44    65.01%
  5/24/96  100 Oxford Hea    48.02     76.00    58.25%
   2/2/96  200 Green Tree    30.39     45.19    48.70%
   3/8/96  400 Prime Medi    10.07     14.38    42.77%
  6/26/96  100 Cisco Syst    53.90     69.63    29.17%
 12/23/96  100 Tidewater     46.52     59.81    28.56%
 11/21/96  150 Oracle Cor    32.43     38.00    17.16%
   3/5/97  150 Atlas Air     23.06     26.00    12.76%

    Rec'd   #  Security     In At     Value    Change
  2/28/96  400 Borders Gr  4502.49  10825.00  $6322.51
  8/13/96  200 Carlisle C  5264.99   8687.50  $3422.51
   2/2/96  200 Green Tree  6077.49   9037.50  $2960.01
  5/24/96  100 Oxford Hea  4802.49   7600.00  $2797.51
   3/8/96  400 Prime Medi  4027.49   5750.00  $1722.51
  6/26/96  100 Cisco Syst  5389.99   6962.50  $1572.51
 12/23/96  100 Tidewater   4652.49   5981.25  $1328.76
 11/21/96  150 Oracle Cor  4864.99   5700.00   $835.01
   3/5/97  150 Atlas Air   3458.74   3900.00   $441.26

                             CASH   $7890.00
                            TOTAL  $72333.75