Fool Portfolio Report
Friday, February 2, 1996
***On Monday, February 5, the Fool Book freight train will be rolling into the Windy City. Their kind of town, Chicago is. Why not stop by Borders Books and Music on N. Michigan Drive between 7 and 8:30 PM. As a special added bonus, there will be a bunch of other area Fools to meet and greet you. Who knows, maybe the Fools will dye their hair in an homage to Rodman.***
by MF Swagman (Jeff Robinson)
--(Syracuse, NY, Feb. 2)-- Well, he did it. The pesky rodent MF Bogey referred to in yesterday's write-up struck today, resigning us to six more weeks of winter. Then, adding insult to injury, investors gave a cold shoulder to Fooldom's two favorite stocks and sent Iomega and America Online sliding backwards. Thanks a lot, Phil! Anyone know any good taxidermists?
On an day which saw gold prices soar, unemployment reach disturbing heights, and the market drop some thirty points, there was very little news on most Fool stocks. The notable exception was Iomega, which will be discussed at the end of this brief article by a notable individual!
There were rumors coursing through the icy air that Mr. Vinik is picking up shares of semi stocks, specifically AMAT. That's nice. Of course, the Fool has held AMAT all along. Not for us are the convoluted shenanigans of market timers. Nope. Life's too short and time's too valuable to waste picking your spots. The Fool will just hold onto AMAT and the other steeds in the stable for the sake of their fundamental strength and because they are pieces of some of the strongest companies around. So, if Mr. Vinik is back, why, here are the Fools to welcome him!
Now, before I bring out the big Kahuna (just a little surfing lingo to warm you up), here's a quick recap of today's action. The biggest winner, on absolutely no company-specific news, was KLA Instruments, which was up $3 1/2 to $33 1/4. That's a pretty nice move no matter how you slice it! Medicis also managed to fight off the cold and tread up for a buck. There were fractional gains in the Gap, GE, and Applied Materials. AMER gave back a full point, and Sears and Chevron were fractionally lower. There was no news on these issues, either.
The big loser of the day comes as no surprise -- Iomega. Poor Iomega, ripped by bears and shorters. But enough of this Swaggish prose! Let me bring out a real heavyweight to sum up this frigid, Foolish day. Here's a passage penned by MotleyFool himself. It's about Iomega, of course!
Following the cancellation of its secondary offering, Iomega Corporation dropped $2.25 to $13. This capped off a volatile week for the stock, quite irrelevant to long-term investors like us.
The most colorful, though ultimately quite trivial, Iomega feature of the week was that the company caught the attention of a financial columnist, who wrote about the stock in all five of his daily columns. Apparently firmly under the thumb of short-selling sources, the writer began with a bearish misreading of the company's financial statements on Monday. Tuesday brought a correction of that info, but with a suitably bearish spin.
Wednesday, when you figured you'd maybe read something about Apple or Hasbro, featured a direct statement made to one of our online readers of the Iomega folder. Thursday it just kept going, featuring "Iomega Insanity." And then today, Friday, what else? Iomega again, but even more hysterical and stridently bearish. Due to the termination of the company's secondary offering (a neutral event, at worst), today's column laughably predicted that the stock would be trading "in the mid-single digits." Monkey see, but monkey didn't.
Now, as Fools we tend not to deal in the day-to-day, week-to-week, or even month-to-month. We're long-term investors who buy shares in great growth companies and hold. And we've done pretty well at that.
So I'd like to close with a note regarding Iomega, but this one's written to true Fools. Those are our more than one hundred thousand readers each month who have read our Fool's School, our new book, understand where we're coming from, and return again and again to Fooldom to learn about investing, to enjoy the process, and (we hope) to profit from the time spent here.
Those who are true Fools will be looking past the spasmodic whims of short-term investors and Chicken Little traders. You will have bought and held Iomega stock and made a lot of money all the way through (and in spite of) the antics of the very Wise, and you will probably still be holding IOMG stock just as we are, because you know a good thing when you see it. You know how to read financial statements, how to value stocks, and how to identify bad logic and bad intentions when you come across them.
You'll be verifying independently the information you read here, trusting those who have earned your trust in the past through excellent analysis, consistency, and humility.
You will continue to assess the situation objectively, and will not shy from criticism of your own position. You will not be rude to anyone, but rather greet any rudeness or arrogance tossed your way with a sense of humor.
Iomega might be one of your holdings, but only one of a number of diverse holdings that make up your market-beating portfolio. And you'll learn a heck of a lot from all of this.
AMER -1 AMAT + 1/2 CHV - 3/4 GE + 1/4 GPS + 3/4 IOMG -2 1/4 KLAC +3 1/2 MDRX +1 S - 1/8
Day Month Year History FOOL -2.14% -0.71% 5.28% 96.58% S&P 500 -0.41% -0.03% 3.23% 38.71% NASDAQ +0.25% 1.17% 1.90% 48.87% Rec'd # Security In At Now Change 8/5/94 680 AmOnline 7.27 44.50 511.86% 5/17/95 1005 Iomega Cor 5.04 13.00 158.04% 4/20/95 155 The Gap 32.55 47.75 46.70% 8/5/94 165 Sears 28.93 41.25 42.61% 8/11/95 95 GenElec 57.91 77.13 33.18% 8/11/95 110 Chevron 49.00 52.13 6.39% 1/29/96 250 Medicis Ph 27.86 28.75 3.20% 8/24/95 130 KLA Instrm 44.71 33.25 -25.63% 8/24/95 100 AppldMatl 57.52 40.38 -29.81% Rec'd # Security Cost Value Change 8/5/94 680 AmOnline 4945.56 30260.00 $25314.44 8/24/95 100 AppldMatl 5752.49 4037.50 -$1714.99 5/17/95 1005 Iomega Cor 5063.13 13065.00 $8001.87 4/20/95 155 The Gap 5045.25 7401.25 $2356.00 8/5/94 165 Sears 4772.65 6806.25 $2033.60 8/11/95 95 GenElec 5501.87 7327.35 $1825.48 8/11/95 110 Chevron 5389.99 5734.30 $344.31 1/29/96 250 Medicis Ph 6964.99 7187.50 $222.51 8/24/95 130 KLA Instrm 5812.49 4322.50 -$1489.99 CASH $12147.13 TOTAL $98288.78