Fool Portfolio Report
Thursday, February 29, 1996

by David Wolpe (DavidWolpe)

ALEXANDRIA, Va, Feb. 29 -- Today's Fool Portfolio write-up has a celluloid twist to it, since it's being penned by David Wolpe, who runs the Fool's film area, affectionately known as Follywood. That's keyword:Follywood. And yes, he's a shameless shill.

He's also a Fool from way back. . . from the days of Styles on Video (touted, and then dumped, in the pages of Ye Olde Printed Foole), and of small folders with but a post or two a day in 'em, of chats with five or six people in attendance. (And, by the way, he *still holds* Styles on Video. But he also holds America Online. From SOV to AMER. Surely there's a scrabble game---and a lesson---in here somewhere.)

Dave and Tom, the brothers Gardner, the talk of the just-concluded Jupiter Online Entertainment Conference in New York, have on occasion been compared to Click and Clack, the entertaining brothers of National Public Radio's "Car Talk." Today's news, then, that KLAC was down $1 3/4 might make the unitiated think that KLIC would also be down. For twins behave uncannily alike. And in fact KLIC *is* down (KLIC being a holding in MF Boring's portfolio, and a company in the same industry as KLAC).

But sometimes when the KLAC is up, the KLIC is down, and vice-versa, in alternating repeating fashion, like so: Klickety-klack, klickety-klack, klickety-klack. And here, here beneath the rumblings of the mighty train that is the Fool portfolio, lies an oft-repeated lesson: don't try to guess the short-term moves of any given stock, since it's over the long term that fundamentals hold sway.

The Fool raced forward today 1.26%, thumping the S&P 500, which slid 0.67%, and the not quite identical, which is to say fraternal twin, Nasdaq, which was off 0.68%.

AMER, our own beloved America Online, bounced back $1 7/8 today. Those of us who were present at the Jupiter conference were extremely impressed by the remarks of AOL President Ted Leonsis. Instead of reacting with fear to the entry of AT&T into the online services arena---the event which has depressed AOL stock during the early part of the week---he welcomed it. Among other things, he noted that it was yet another 'death-knell' being sounded for AOL, following 'the-entry-of-Microsoft-death-knell' and 'the resurgence-of-the-web-death-knell,' among others.

He predicted that the online market, once it reaches maturity, will be a $200 billion market; or roughly double what the PC market is today. He also suggested that AT&T's entry will, in a major sense, legitimize the web for many uninitiated users, providing a sense of security and safety which will benefit 'all of the companies represented on this stage.' At which point he gestured to the other participants in the roundtable: the respective heads of Compuserve, the Microsoft Network, and Prodigy.

F. Scott Fitzgerald once remarked that "not half a dozen men have ever been able to keep the whole equation of pictures in their heads." The impression radiated at that conference was that Mr. Leonsis very comfortably wraps his mind around the whole equation of the online universe. He was the sun of this roundtable; the other participants swirling about him like asteroids. We're holding our AMER stock, come next whatever death-knell may.

"Amo, Amas, Amat!" cries Masha in Chekhov's "Three Sisters." She's exasperated with her dimwit husband, Kulygin, the schoolteacher. He begs her to love him, and all she can do is conjugate the Latin verb for 'love.' AMAT indeed, down $2 3/4, slumping and sulking in resonance with the news that LSI, another semiconductor maker, will be missing earnings expectations by 10%. But love, too, has its seasons and its swings. I'm sure all you husbands and wives recognize the daily bread of married life. Be free with your feelings, forgive one another, go easy on the bickering, and we're sure AMAT will bounce back, too. And probably love you even more than before.

Medicis Pharmaceutical was up $1 on news that it has relaunched the company's THERAMYCIN Z, a topical erythromycin lotion used in the treatment of acne vulgaris, effective in reducing the visible signs of redness and inflammation. Here at Fool HQ, we're washing our faces, running trembling fingers over silk-soft skin, and pinching ourselves just for good measure.

The Gap was off $1/4, even on the news today that sales increased 26% for the just completed 14-week fourth-quarter, over the 13-week fourth quarter reported for last year. Could this be the rising and falling of the old saw about buying on rumor and selling on news? For a detailed look at the Gap, check our special feature on the Gap in our mainscreen listbox.

Klickety-klack, klickety-clack.

Today's Moves

AMER +1 7/8
AMAT -2 3/4
CHV + 5/8
GE - 5/8
GPS - 1/4
IOMG + 3/8
KLAC -1 3/4
S - 1/4

Today's Numbers

Day Month Year History FOOL +1.26% 7.93% 14.45% 113.70% S&P 500 -0.67% 0.69% 3.98% 39.71% NASDAQ -0.68% 3.80% 4.55% 52.75% Rec'd # Security In At Now Change 8/5/94 680 AmOnline 7.27 49.13 575.45% 5/17/95 1005 Iomega Cor 5.04 18.63 269.69% 4/20/95 155 The Gap 32.55 53.50 64.36% 8/5/94 165 Sears 28.93 45.25 56.44% 8/11/95 95 GenElec 57.91 75.50 30.36% 8/11/95 110 Chevron 49.00 55.38 13.01% 1/29/96 250 Medicis Ph 27.86 27.50 -1.29% 8/24/95 100 AppldMatl 57.52 35.63 -38.07% 8/24/95 130 KLA Instrm 44.71 24.00 -46.32% Rec'd # Security Cost Value Change 8/5/94 680 AmOnline 4945.56 33405.00 $28459.44 8/24/95 100 AppldMatl 5752.49 3562.50 -$2189.99 5/17/95 1005 Iomega Cor 5063.13 18718.13 $13655.00 4/20/95 155 The Gap 5045.25 8292.50 $3247.25 8/5/94 165 Sears 4772.65 7466.25 $2693.60 8/11/95 95 GenElec 5501.87 7172.50 $1670.63 8/11/95 110 Chevron 5389.99 6091.25 $701.26 1/29/96 250 Medicis Ph 6964.99 6875.00 -$89.99 8/24/95 130 KLA Instrm 5812.49 3120.00 -$2692.49 CASH $12147.13 TOTAL $106850.26