Fool Portfolio Report
Friday, November 17, 1995
Yes, there's a transaction report sitting out on the Hall of Portfolios screen right now. . . and yes, it details our intention to sell our entire and shrunken position in Sonic Solutions (NASDAQ:SNIC), the stock which has fallen 51.67% and lost us over $2,500. And this all while the Standard & Poor's 500 has climbed 30%, en route to its second greatest year over the past two decades.
We don't have to tell you how bad an investment SNIC has been for us. But, of course, this just comes with the territory when you invest. The aim is total portfolio growth, total savings growth, not stockpicking.
Enjoy the sell report on SNIC; hopefully we've seen it clearly enough to remind ourselves of some very important investment lessons. And for those who would like to review sell rules, the transcript from the MF Bogey Selling Strategies Auditorium Event last Tuesday has been edited for your convenience and is posted now as a Fribble, available via The Daily Fool button on our mainscreen.
Now, the day and week in review.
How about The Gap (NYSE:GPS)? Apparently, Wall Street very much agreed with our initial price targeting of GPS shares between $40 and $45, back when the stock was trading at $32 per stub. After 3rd quarter earnings raised institutional eyebrows, with sales, earnings, profit margins and working capital all exceeding expectations, it was time to lift our target price. Which we have. . . to between $51-$55 a share.
Wall Street appeared to agree today, as The Gap rose $2 3/4 on the day to a bid of $49 1/4. The Gap is now 51.3% above where we purchased it last May. . . a few bucks higher and we commit to another re-evaluation of our holding again. Go Gap!
Iomega finished the week strong as well, with a $1.25 upward move to a bid of $34 1/8, up 125.8% for Fools. . . up considerably more for investors who got in below our cost of $15.11 per share.
Iomega announced today that its wholly-owned European subsidiary, Iomega Europe GmbH, has signed a $35 million (US) multi-currency credit agreement with Heller Bank AG of Mainz, Germany, which complements IOMG's Wells Fargo agreement in the US.
It seems to have worked once to finance monstrous growth with debt and hold tight the equity. Apparently the few on Wall Street who know about this business agreed. Iomega touched up near to its 52-week-high to close the week. BYTEUP's reviews from Comdex sit in our mainscreen listbox, wonderful articles all. . . and they give a nice view into Iomega's participation there.
Five days ago, Chevron was trading at $47 5/8. Today, the stock closed at $50. Does anyone at Fool Global HQ know why? Nope. We've got our eyes on the dividend, on our one-year sell date, and on Beating the Dow compounded returns. Someday we'll read up on the company. :)
Sears, a Dow stock that we actually do follow and do enjoy following, closed up the week a half point, and announced today that it will buy the beleaguered Emporium in downtown Oakland and stamp it with a 180,000 square feet of Sears shtuff. Financial ratios, management strength, and the yield has us pricing this stock at $45 in the year ahead. We'll have made a good deal of money over these two years in the Company people loved to hate. Go Sears!
The two dogs of the week were our semiconductor holdings, KLA Instruments and Applied Material, each had bad Fridays, falling $2 3/4 and $1 1/8 respectively. We continue to price these shares well north of here, and they continue to resist us. Combined, KLAC and AMAT forced us into a flat week. At the end of last week, we were up 88% and change, and we end this week in the same spot.
For the record, these are stocks we'd bottom-fish on here. That said, EVERY individual investor portfolio should start with Beating the Dow, then move into strong-performing, cash-powered growth stocks. . . and then possibly go to turnaround plays. Oh, and shorts. SNIC gone, they may be coming soon.
That's our take, anyway.
Make it a Foolish weekend. . . get a few minutes outside away from the computer. A suggestion for you that's really a suggestion for ourselves!
Tom Gardner, November 17, 1995
AMER -1 1/2 AMAT -1 1/8 CHV + 5/8 GE - 5/8 GPS +2 3/4 IOMG +1 1/4 KLAC -2 3/4 RIDE - 5/8 S - 1/8 SNIC ---
Day Month Year History FOOL -0.49% 5.23% 69.73% 88.45% S&P 500 +0.46% 3.19% 30.66% 30.91% NASDAQ +0.05% 0.87% 38.97% 45.11% Rec'd # Security In At Now Change 8/5/94 340 AmOnline 14.55 78.13 437.10% 5/23/95 510 Ride Inc. 9.91 24.75 149.83% 5/17/95 335 Iomega Corp 15.11 34.13 125.79% 4/20/95 155 The Gap 32.55 49.25 51.31% 8/5/94 165 Sears 28.93 39.25 35.70% 8/11/95 95 GenElec 57.91 66.88 15.47% 8/11/95 110 Chevron 49.00 50.00 2.04% 8/24/95 100 AppldMatl 57.52 46.50 -19.17% 8/24/95 130 KLA Instrm 44.71 35.75 -20.04% 12/23/94 340 SonicSol 14.48 7.00 -51.67% Rec'd # Security Cost Value Change 8/5/94 340 AmOnline 4945.56 26562.50 $21616.94 5/23/95 510 Ride Inc. 5052.44 12622.50 $7570.06 5/17/95 335 Iomega Corp 5063.13 11431.88 $6368.75 4/20/95 155 The Gap 5045.25 7633.75 $2588.50 8/5/94 165 Sears 4772.65 6476.25 $1703.60 8/11/95 95 GenElec 5501.87 6353.13 $851.26 8/11/95 110 Chevron 5389.99 5500.00 $110.01 8/24/95 100 AppldMatl 5752.49 4650.00 -$1102.49 8/24/95130 KLA Instrm 5812.49 4647.50 -$1164.99 12/23/94 340 SonicSol 4924.18 2380.00 -$2544.18 CASH $5969.86 TOTAL $94227.36