Thursday, April 30, 1998

Cash-King Portfolio Report
by Tom Gardner
([email protected])

Alexandria, VA (Apr. 30, 1998) -- It doesn't seem fair; it doesn't seem right; but that's the way it is.

Our newest Cash-King selection, Gap Inc. (NYSE: GPS), closed out a second strong day since our buy announcement. The stock was at $46 1/4 when we published our intent to purchase; today Gap shares closed up $3 1/2 to $51 1/2. Since our report, the stock has risen 11.4% on not a lick of news. Not a word. Nuthin'.

Up 11.4%.

And... we haven't purchased our shares yet!

(Insert .wav file of sold-out Yankee Stadium booing.)

Maddening. Why haven't we purchased our shares?!

Get ready for a few excuses.

Yesterday at dawn, David and I flew down to Charlotte, NC. I spent the day talking with Fools at a Borders booksigning, drinking coffee with our media escort Karen, chatting about finances on the local NPR station. We were even then damned in two interviews on another station: WBT Radio and TV.

(Why? For unwittingly having made a fool of their on-air financial professional via our April Fool's joke. It turns out that on April 1st, he went live with our story, charging us with having lied for years and marveling at how we possibly couldn't have known that 91% of all mutual funds BEAT the market each year. Believe it or not, the thinking at WBT in Charlotte is that we should be jailed for having run our "story" on April 1st.

Brought to you by... a financial professional? Interesting.)

A fine day in Charlotte ended. But with no Gap transaction.

Then this morning, back in the office, I darted into and out of meetings all day -- from 9 a.m. until the final bell was ringing on Wall Street. Now, I could have slid over to my desk to place the order, but I was hoping against hope to purchase the stock back at $46 1/4, the share price on the eve of our announcement. Unfortunately, the stock market didn't know I wanted to buy it there.

So here we sit.

The stock is up 11.4% in the last two days. Long-time Gap shareholders are extremely happy. Cash-King Fools who may have purchased this stock in the last 48 hours are smiling. But not me. It's so easy to preach long-term investing... but, oh, how violable the principles are when you're trying to save quarters and half points. Needlessly.

So I leave you with this question tonight: Should I just buy before 1 p.m. tomorrow? Or should I hold off for another day and let the stock cool down (risking another $3 rise)? Or should I wait out additional days -- since we have until Tuesday to purchase our GPS shares?

Of course, I'm thinking I ought to just eat crow, nibble on the crusts of humble pie, put on my belled cap and put in our buy order midday tomorrow. Will short-term values matter if Gap ends up dominating casual clothing across the planet over the next three decades? Probably not. But geez, come on... 11.4% in two days with no news!

No news! Geez.

What should I do, Fools: Buy Gap When? Tom Gardner, Fool

P.S. If you don't much care when we buy our Gap shares... well, here's a different interesting Internet link. If you or anyone you know has credit card debt, have them drop by Ram Research. Great site.

TODAY'S NUMBERS

Stock  Change    Bid 
 ---------------- 
 CHV   -  3/8   82.88 
 KO    +2 1/8   75.81 
 EK    +  15/16 72.19 
 XON   -1 3/8   72.94 
 GM    -  9/16  67.38 
 INTC  +  3/4   80.81 
 MSFT  -  5/16  90.13 
 PFE   +1 5/16  114.00 
 TROW  +2 3/16  75.19 
 
                  Day   Month    Year  History 
         C-K      +0.72%   4.35%   8.47%   8.47% 
         S&P:     +1.57%   0.91%  11.03%  11.03% 
         NASDAQ:  +0.91%   1.78%  13.04%  13.04% 
  
 Cash-King Stocks 
     Rec'd    #  Security     In At       Now    Change 
     2/3/98   22 Pfizer        82.30    114.00    38.52% 
     2/3/98   24 Microsoft     78.27     90.13    15.15% 
     2/6/98   28 T. Rowe Pr    67.35     75.19    11.64% 
    2/27/98   27 Coca-Cola     69.11     75.81     9.70% 
    2/13/98   22 Intel         84.67     80.81    -4.56% 
  
 Foolish Four Stocks 
     Rec'd    #  Security     In At     Value    Change 
    3/12/98   20 Eastman Ko    63.15     72.19    14.32% 
    3/12/98   20 Exxon         64.34     72.94    13.37% 
    3/12/98   15 Chevron       83.34     82.88    -0.56% 
    3/12/98   17 General Mo    72.41     67.38    -6.95% 
  
  
 Cash-King Stocks 
     Rec'd    #  Security     In At     Value    Change 
     2/3/98   22 Pfizer      1810.58   2508.00   $697.42 
     2/3/98   24 Microsoft   1878.45   2163.00   $284.55 
     2/6/98   28 T. Rowe Pr  1885.70   2105.25   $219.55 
    2/27/98   27 Coca-Cola   1865.89   2046.94   $181.05 
    2/13/98   22 Intel       1862.83   1777.88   -$84.95 
  
 Foolish Four Stocks 
     Rec'd    #  Security     In At     Value    Change 
    3/12/98   20 Eastman Ko  1262.95   1443.75   $180.80 
    3/12/98   20 Exxon       1286.70   1458.75   $172.05 
    3/12/98   15 Chevron     1250.14   1243.13    -$7.02 
    3/12/98   17 General Mo  1230.89   1145.38   -$85.52 
  
                               CASH   $5801.16 
                              TOTAL  $21693.22 
   
 *The year for the S&P and Nasdaq will be as of 02/03/98