Fool Portfolio Report
Tuesday, June 3, 1997
by Jeff Fischer (TMFJeff)
ALEXANDRIA, VA, (June 3, 1997) -- "The traveler sees what he sees, the tourist sees what he has come to see."
That's according to a chap named Chesterton. I think it could read, "An investor sees what he sees," and still hold the same meaning. Meanwhile, a "tourist" -- or a person in the market for only a certain period of time, and for only one reason -- wants to see one thing, but likely ends up disappointed.
Fools have seen a lot in the past two -- nearly three -- years. This epic recap is going to summarize all of it:
Let's just try to summarize today, first. That's challenge enough for a Fool with a mind that wanders so actively. Italy... France... Spain. Summer. Stock recap? Stock recap.
Well, the day wasn't much to write home about. The Fool dropped 0.93% as the Nasdaq Composite shed a full 1.42%, while the S&P 500 chugged Gatorade all day in order to stay awake, and ended down only 0.10%.
3COM (Nasdaq: COMS) was crunched for more than $3 after Cabletron Systems announced that it wouldn't make its earnings estimate. Networking stocks -- acting as if Cabletron had double-dipped a tortilla chip in the salsa sauce, so that now nobody could eat it -- all ran for cover, heading lower. As if they all share the same pool of customers, selling the same products. That's not true, but the indiscriminate selling isn't a surprise.
(Editor's note: The next paragraph is long, but you want to read it.)
Meanwhile, 3Com announced a new Ethernet network interface chip for NetPCs and other "thin clients" -- thin clients meaning: computers lacking all the guts of traditional computers, which run on a network in order to lower costs. Intel, Microsoft, Oracle, IBM -- they're all working on these things. Cisco Systems is working with Intel and Microsoft, so of course we're cheering for our boy, 3Com. As much as we love world-leading, dominant companies, sometimes ya gotta get sick of them. Ya know. It's fun to cheer for Slovenia at the summer olympics. The little guy.
Of course, 3Com isn't a little guy.
The most recent reports confirm that 3Com has a giant lead in the Fast Ethernet market. The argument that Intel is going to crush that lead is only marginally threatening. Intel will bite away at some low-end NIC products (yes, even these little products have high-end and low-end offerings within themselves), but when customers need more from a NIC -- need the best -- 3Com is the easy leader.
It's estimated that 21 million NetPC and Network Computer clients will be in existence by the year 2001. 3Com's new chip for them is called the 3C917.
Now there's the one point of contention that Fools have with this product: the 3C917? Sure it means something, but let's give it another name, 3Com. Suggestions from readers? Send 'em my way. We'll send them to 3Com.
(Editor's note: you're almost finished.)
The other news on this "thin day" came from IOMEGA (NYSE: IOM). In a pleasant surprise to the world, the company announced a new product called "RecordIt."
What is it?
It's digital recording software that accomplishes audio recording and playback on personal computers with the sound quality of a compact disk. The software allows a computer to record live and other audio and digitally save it to be used from a Zip disk, Jaz disk, or a hard drive. The company shared that the product is ideal for those on the road and wanting to record meetings, conferences, speeches, notes to their lover bird back home (embellishment on press release), for students in lectures, and to create multimedia presentations, and so on and so forth. Beautiful!
If you're dealing with storage -- of all kinds -- the possibilities are endless. Iomega just might become the Gillette of storage over the coming years -- during the information age. Nice timing.
The RecordIt software is $39.95 and will be included as standard on the notebook Zip drive, which ships in the second half of this year. My only advice is that Iomega calls it "Record It." Two words. RecordIt isn't fun to read.
Fools from our Iomega message board had more relevant things to say. Tjctester wrote, "About one year ago I said that the Zip could replace the cassette for audio. You all Laughed. Watch out. You may be carrying a Zipper instead of your Walkman or CD player."
Zakrosian wrote, "This could be the news that gets me to go out and buy a Zip along with a 10 pack of disks if it is what it seems to be... Was this a complete surprise or did I miss posts referring to it?"
Finally, Doc Jimbo wrote, "I doubt that Zip will transition to be the next portable sound format (the ZipMan!!). I do believe that we'll see more music available from the Net in the next few years and the Zip would be a fine way to keep samples or singles to play on your computer. Those media files will be one of the forces that makes Zip more and more necessary for computer users."
That's all the news for today.
As for writing an epic recap that covers the entire history of Foolishness... I think we just may be able to pull it off. Let's try.
It all began on a cool morning, when David Gardner rose from his sleeping bag along the Nile. Tom's tent was near-by, the smoke rising from...
Wait. Out of time.
--Jeff Fischer, June 3, 1997
Boards -- what are Fools saying?
Evening News -- Big movers, up and down.
Daily Double -- How can you find the next double?
Daily Trouble -- Is there value in this beaten down stock?
Boring Portfolio -- Cisco, Oracle and more.
Fool Four -- These giants are... monstrous.
Stock Change Bid -------------------- AOL -2 5/8 56.00 T + 1/4 35.88 ATCT + 7/32 5.13 CHV +1 1/4 71.38 DJT + 1/4 9.88 GM - 1/8 56.88 IOM + 1/2 19.25 KLAC -1 13/16 46.25 LU -1 5/8 62.50 MMM + 1/2 91.38 COMS -3 3/16 45.88Day Month Year History FOOL -0.93% 1.65% 4.28% 178.29% S&P: -0.10% -0.33% 14.14% 84.44% NASDAQ: -1.42% -1.10% 7.27% 92.30% Rec'd # Security In At Now Change 8/5/94 355 AmOnline 7.27 56.00 670.29% 5/17/95 980 Iomega Cor 2.52 19.25 663.89% 8/11/95 125 Chevron 50.28 71.38 41.94% 8/12/96 110 Minn M&M 65.68 91.38 39.13% 10/1/96 42 LucentTech 47.62 62.50 31.26% 8/12/96 280 Gen'l Moto 51.97 56.88 9.43% 8/24/95 130 KLA Tencor 44.71 46.25 3.44% 8/13/96 250 3Com Corp. 46.86 45.88 -2.10% 8/12/96 130 AT&T 39.58 35.88 -9.36% 4/30/97 -1170 *Trump* 8.47 9.88 -16.60% 10/22/96 600 ATC Comm. 22.94 5.13 -77.66% Rec'd # Security In At Value Change 8/5/94 355 AmOnline 2581.87 19880.00 $17298.13 5/17/95 980 Iomega Cor 2594.53 18865.00 $16270.47 8/12/96 110 Minn M&M 7224.44 10051.25 $2826.81 8/11/95 125 Chevron 6285.61 8921.88 $2636.27 8/12/96 280 Gen'l Moto 14552.49 15925.00 $1372.51 10/1/96 42 LucentTech 1999.88 2625.00 $625.12 8/24/95 130 KLA Tencor 5812.49 6012.50 $200.01 8/13/96 250 3Com Corp. 11714.99 11468.75 -$246.24 8/12/96 130 AT&T 5145.11 4663.75 -$481.36 4/30/97 -1170*Trump* -9908.50 -11553.75 -$1645.25 10/22/96 600 ATC Comm. 13761.50 3075.00-$10686.50 CASH $49211.92 TOTAL $139146.30