Boring Portfolio

Boring Portfolio Report
Thursday,  November 13, 1997
by Mark Weaver (TMFBoring@aol.com)


St. Louis, MO (November 13, 1997) - It is an unusual week for the Borefolio report. Yesterday Greg Markus filed his report from 30,000 feet, oblivious to the stock market's final close. Today I am filing at 6AM, before the bell. While Greg was flying off to see where Cisco is headed, I will be spending this market day of my vacation in a duck blind.

That won't dissuade me though, I will do my best Karnak imitation and tell you what the market is going to do today.

Reflecting on yesterday's market decline I see the work of continued worry about inflation spurred by wage increases resulting from tight labor markets.

Who are these people that are making more money? I want to meet those guys. At the hospital where I work salaries are capped, benefits are being cut. Doctors across the land are making less each year due to managed care reimburement. I look in yesterday's paper and see 10,000 jobs cut at Kodak plus a few thousand more at Fruit of the Loom and DKNY. There's a little labor loosening for you.

Here's my first prediction: the Fed won't raise rates in December either.

Others will realize the same and the general market will be higher today (sitting here I see that S&P futures are up over 1% before the opening bell), the Nasdaq will be higher yet. The Borefolio will outpace them both. Why you ask? Tech stocks have been brutally battered over the past several sessions and, as such, are do for a rally. That will favor the Naz. I am expecting some good things out of Cisco Systems (Nasdaq: CSCO) meeting today which should boost our tech representative disproportionately higher. Cisco has been caught in 3Com's (Nasdaq: COMS) downdraft which was in large part fueled by a modem inventory buildup. Cisco doesn't participate in the modem biz.

How did investors shrug off the good news at Atlas Air (NYSE: CGO)? Maybe it was the change in the stock symbol. Today reality will hit and Atlas will regain its losses as investors reflect on the Atlas announcement of expected increased earnings for FY 1998 and the purchase of an additional plane from Boeing.

The Borefolio's strongest performer Borders Group (NYSE: BGP) will move up fractionally today. The stock was down hard on no news. There has been little news in the world of books generally. Retailing stocks often get a boost headed into the shopping season and Borders is no exception.

Felcor Suite Hotels (NYSE: FCH) will rise today as well. REITS investing in movie theatres are the subject of today's "Heard on the Street" column and I think that the sector will bask in the glow. The ITT/Starwood deal is settling down and that should decrease the 'volatility' of the hotel REIT sector. Actually the recent volatility of the sector is very unusual. Watching REIT stock quotes is more often similar to watching paint dry.

You have to love Tidewater (NYSE: TDW). That stock will continue its upward climb because of sabre rattling in the MidEast. Why do we pay so much attention to those knuckleheads in Iraq? In the words of Louie, the Budweiser lizard, they are mocking us! The one in the middle of the picture is mocking the UN in particular my friend.

Tidewater remains a beneficiary of the strong oil services group and the good news continues for those stocks. The Tide will rise.

Prime Medical Services (Nasdaq: PMSI) won't move much but will move ahead fractionally. While the company continues to do everything we have expected of it, the stock has been a disappointment. I suspect worries about Medicare reimbursement have held it back but, in all respects the company is growing at the rate that we had anticipated. There is no reason to expect a breakout day for Prime today.

Oracle (Nasdaq: ORCL) will have a press release. That is the safest bet in America.

I can't get a grip on Green Tree Financial (NYSE: GNT). While bonds are near multi-year lows, the stock has still drifted lower. A low interest rate environment should favor the company. Like leaves in Autumn the stock price fell yesterday. Today it mounts a strong comeback. I predict the Tree will gain over a buck today.

I will leave you with one more pre-market prediction. Carlisle (NYSE: CSL) will move up today as investors realize that they will still play golf in Japan even though their markets are down. Golf cart wheels should be decoupled from the market turmoil in Asia in my opinion. I can only surmise that worries about Carlisle's exposure to golf cart wheels coupled with the raging popularity of golf in the Far East has caused the stock to fade. Today reality sets in. Another stock up over a buck.

Whew, now I feel better.

Happy market hunting to you while I chase the wiley duck. Duck lovers need not fear for their feathered friends. My pre-hunting prediction is zero ducks for me. Another safe bet, this is my first time in a duck blind.

                  Today's FoolWatch -- all the latest in Fooldom.


TODAY'S NUMBERS
Stock  Change    Bid
CGO   -  13/16 25.06
BGP   -  1/16  27.81
CSL   -1 1/16  41.94
CSCO  +2 7/8   79.50
FCH   +  3/4   37.25
GNT   -  15/16 40.38
ORCL  +  13/16 33.31
PMSI  +  3/16  13.06
TDW   -3 3/8   62.00
                   Day   Month    Year  History
        BORING   -0.38%  -2.03%  15.04%  32.38%
        S&P:     +1.18%   0.22%  23.75%  47.46%
        NASDAQ:  +1.04%  -2.25%  20.66%  49.64%

    Rec'd   #  Security     In At       Now    Change
  2/28/96  400 Borders Gr    11.26     27.81   147.09%
  8/13/96  200 Carlisle C    26.32     41.94    59.31%
  6/26/96  100 Cisco Syst    53.90     79.50    47.50%
 12/23/96  100 Tidewater     46.52     62.00    33.26%
   2/2/96  200 Green Tree    30.39     40.38    32.87%
   3/8/96  400 Prime Medi    10.07     13.06    29.73%
   3/5/97  150 Atlas Air     23.06     25.06     8.69%
 11/21/96  150 Oracle Cor    32.43     33.31     2.71%
  11/6/97  200 FelCor Sui    37.59     37.25    -0.90%


    Rec'd   #  Security     In At     Value    Change
  2/28/96  400 Borders Gr  4502.49  11125.00  $6622.51
  8/13/96  200 Carlisle C  5264.99   8387.50  $3122.51
  6/26/96  100 Cisco Syst  5389.99   7950.00  $2560.01
   2/2/96  200 Green Tree  6077.49   8075.00  $1997.51
 12/23/96  100 Tidewater   4652.49   6200.00  $1547.51
   3/8/96  400 Prime Medi  4027.49   5225.00  $1197.51
   3/5/97  150 Atlas Air   3458.74   3759.38   $300.64
 11/21/96  150 Oracle Cor  4864.99   4996.88   $131.89
  11/6/97  200 FelCor Sui  7518.00   7450.00   -$68.00

                             CASH   $3021.10
                            TOTAL  $66189.85


Spacer