Fool Portfolio Report
Tuesday, April 2, 1996
(FOOL GLOBAL WIRE)
Tom Gardner (TomGardner)
ALEXANDRIA, VA, April 2, 1996 -- Ten parents in the bleachers shouting at the little guy playing shortstop to stay down on groundballs. An ole codger with the faint spoor of brandy on his lips waiting at the concessionare stand for someone, *anyone* to pick up a dog 'n a ballcap. The dusty infield. Spiked cuts on knees. Unknown outfielders on unknown teams chasing down lazy flyballs. Dugout mouths, glazed with chewing gum, chattering.
Little league ball? you ask. Semi-pro? The rookie leagues?
Try the Major Leagues, where twenty-eight pretty unknown teams took the field this week in relatively empty stadiums. Baseball attendance in 1995 fell 20%, and future Hall-of-Famer Paul Molitor confessed yesterday that he's not certain that the major leagues in their present form can make a comeback with the fans.
What little consensus we can dig up at Fool Global HQ tells us that major league baseball is a somewhat confusing construct these days. Consider the following:
a. There are six divisions now;
b. Most fans don't yet understand the playoff structure;
c. Interleague play will begin in 1997;
d. The league will dilute talent, adding two more teams in 1998 (Arizona and Tampa);
e. The strike zone now extends below the kneecap;
We at Fool HQ think there's probably every reason to believe that Molitor is right---at least in the short-term---that it's going to take some doing for baseball to bounce back. But that's not going to steal away any of our love for the *game.*
Our love of cold days, when foul balls vibrate up to the elbow, remains. Double steals. Pitchers that walk in three runs. Coaches teaching lessons. . . and cusswords. Grandslams that roll beneath second baseman and center-fielder legs. Evenings on paint-chipped green bleachers. Suns setting behind white-washed church steeples. Mad-cowless hot dogs and mustard spilt down t-shirts. Close plays at the plate; collisions in the outfield; dugout chattah; weak-hitting shortstops; fireballers with no control---baseball season is back. And at Fool HQ, we love it.
Whether or not the business of major league baseball can regain its customer-service edge, its lure, one thing's for sure: the moneyless business of putting stick to sphere will retain its hold on many Fools. Softball leagues, little leagues, semi-pro baseball, the minor league squad, backyard whiffle-ball stadiums with yellow bats and plastic balls. . the game and the summer are back.
And that's some of what takes Wall Street away from its terminals, executives from their boardrooms, employees out the door at four, and consumers away from computer stores, leading to decreased trading (always a good thing, in our minds), softening sales (not so good), and market downturns (comes with the territory).
In that spirit, we roll out The Portfolio Fools---that co-ed softball squad with attitude. These ballplayers are frocked up in motley attire, hats turned slightly off-center.
Strutting up onto the mound is our left-handed fireballer, America Online. He's got the nation behind him. . . literally.
AMER, the Bob Gibson of Fooldom, has been working out feverishly in the offseason and his knuckle-slider was clocked this spring above 670 miles per hour. He lost a mile off that today, but our local league's horrified at the thought of AOL unleashing fastballs.
There she is, Iomega Corporation, behind the plate, scooping up everything AOL has to offer. In this afternoon's scrimmage, Iomega tossed out another $1 7/8 runners, bringing her one-year totals up to 443 basestealers nabbed. She's lean; she's second in the league in doubles; it's been an awfully long time since she was a "single-digits" stock; and she lets the numbers speak for themselves.
Down at first base, General Electric hasn't let a ball one-hop past him since the spring of 1994, when bad weather was making fielding a bit of a nightmare. Fifteen years ago, G-Man announced that he'd stop playing the game if he wasn't the single greatest first baseman on the planet. He's still playing. GE suits up three hours before every game to practice knocking puff pitches off the neon Foolcap, 720 feet away in left-centerfield.
Over at third base, Sears digs out one-hoppers, barehands bunts, snags burning linedrives and hasn't missed a tag since joining the squad in the summer of 1994 (the single best-performing Dow stock since then).
Sears just mailed out his own player program today, complete with talk of long-term loyalty and a fiercely equal committment to his teammates, the Fools' coaching staff, management, and every fan who pays away an hour or two to sit through early evenings in the ballyard. That new program---that annual report---comes as highly recommended by Fools as anything in recent memory.
Don't ask us about our shortstop.
Darn. You did. Medicis Pharmaceuticals looks spectacular out there, ten feet behind and to the left of second base. He carries a comb in his backpocket, is cleanshaven, not a nick on his face, stirrups pulled up tight, cleats polished, and ever since a fine performance in the winter leagues, he's dropped a few balls and missed a tag or two. The real test comes in about a month, when we sort through a full statistical review of his performance.
Don't ask about our second baseman.
Ouch. KLA Instruments leads the league in errors with 50. The Fools traded away our spectacular but possibly aging rightfielder, Ride Snowboard, to button-up KLAC in motley garb.
And late last summer, she took the field to a smattering applause from the peanut gallery and walked away from that first game with her head hanging low. Balls raced past her on the left, jumped off stones over her right shoulder, rocketed over her outstretched glove, and rolled slowly between her legs. She's one of the best fielders we have in winter practice, but with games on the line, we'll need more from her in 1996.
Hey, how 'bout that flashy center-fielder, gliding from the warning track to the infield dirt, grabbing sinking line drives and scaling the chain-linked fence in rightcenter to take homeruns away from the Wise.
The Gap hasn't been seen on Fool-field without a smile since joining the squad last spring. Sadly, the Gap has had a few bad games recently, but management looks back at the performance record since she first tugged on cap and glove to play her first softball game ever many moons back, and we know we have one of the best in uniform.
Don't pass your eyes over to rightfield because Applied Materials is still looking like an outfielder that shouldn't have suited up.
Diehard Fool fans remember when AMAT first yanked on his Fool ballcap, pushed down a jawful of tobacco, raced out to leftfield, turned to wave to his extended family behind the plate and ran headlong into newbie second baseman KLAC.
Applied Materials separated his knee the very first day he threw on Fool duds. And as team doctor, Merck, had been let go by management, AMAT was and has been forced to play with his kneecap down around his ankle. It's not a pretty sight. And it makes for a broad strikezone. AMAT has dropped forty flyballs and can't break out of the bottom of our batting lineup. We're hoping his kneecap has settled in nicely there at ankle level and that 1996 will bring happier times.
Out in leftfield, patting a last handful of baby oil on her face, stands Chevron. The Fools picked up Chevy with the extra monies left over from the dismissal of team doctor, Merck. Chev's had a decent year, and played a spectacular game this afternoon, batting in 7/8ths of a run. Some Fool fans note that Doc Merck was a more valuable contributor and has had a better year since our goodbye wave, but darn it if The Fool Van wasn't running out of gas too often en route to away games.
And there you have it, the Portfolio Fools as of April 2, 1996.
To date, there is not a single team out there with a 1-2-3-4-5 punch like America Online, Iomega, Sears, The Gap and General Electric. The average softball team has won a mere 43 games, and the majority of teams have won well less than 43.
In the meantime, the PortFools have tucked away 140 wins. And while there's no guarantee that we'll continue to zip triples down the line, huck curveballs that hypnotize our opponents, and tag out the Wise for not touching firstbase. . . that was never our aspiration anyway.
We first took the field with you all in August of 1994, hoping to teach America about the business and the game of long-term investing. We were hoping as well to learn how to play better from you all, and hoping to make practice, the clubhouse, the dugout, the ondeck circle, the infield, the outfield, the bleachers, the box seats, the hammock down the leftfield line and the pressbox an enjoyable place to be. To teach, to amuse, to hold ourselves accountable. . . and only after these, to aim to help you profit in excess of the Wise.
All of this has come to pass and far more.
We're hunkering down to do just that again in 1996, and in the many years beyond. Beating the Wise is considerably less of a challenge than it should be---with their creative bookkeepting, creative marketing, and overactive trading.
In our minds, all we Fools will beat them simply by teaching, entertaining and holding ourselves strictly accountable. Manage your portfolio like the business and the ballclub that it is. That's what makes investing one of the finest of American traditions.
Motley's the only wear.
AMER - 3/4 ...AMAT - 7/8 ...CHV + 7/8 ...GE + 1/8 ...GPS - 7/8 ...IOMG +1 7/8 ...KLAC - 1/4 ...MDRX - 3/8 ...S - 3/4 ... Day Month Year History FOOL +0.85% 1.01% 28.38% 139.72% S&P 500 +0.24% 1.51% 6.39% 42.95% NASDAQ +0.43% 0.90% 5.62% 54.31% Rec'd # Security In At Now Change 8/5/94 680 AmOnline 7.27 55.88 668.26% 5/17/95 1005 Iomega Cor 5.04 27.38 443.38% 8/5/94 165 Sears 28.93 47.75 65.08% 4/20/95 155 The Gap 32.55 53.63 64.75% 8/11/95 95 GenElec 57.91 79.63 37.49% 8/11/95 110 Chevron 49.00 57.13 16.58% 1/29/96 250 Medicis Ph 27.86 23.38 -16.10% 8/24/95 100 AppldMatl 57.52 34.63 -39.81% 8/24/95 130 KLA Instrm 44.71 22.00 -50.80% Rec'd # Security Cost Value Change 8/5/94 680 AmOnline 4945.56 37995.00 $33049.44 8/24/95 100 AppldMatl 5752.49 3462.50 -$2289.99 5/17/95 1005 Iomega Cor 5063.13 27511.88 $22448.75 4/20/95 155 The Gap 5045.25 8311.88 $3266.63 8/5/94 165 Sears 4772.65 7878.75 $3106.10 8/11/95 95 GenElec 5501.87 7564.38 $2062.51 8/11/95 110 Chevron 5389.99 6283.75 $893.76 1/29/96 250 Medicis Ph 6964.99 5843.75 -$1121.24 8/24/95 130 KLA Instrm 5812.49 2860.00 -$2952.49 CASH $12147.13 TOTAL $119859.01