Fool Portfolio Report
Monday, July 21, 1997
by Jeff Fischer (TMFJeff@aol.com)
ALEXANDRIA, VA, (July 21, 1997) -- A good day for our friend, Mr. Fool Portfolio. He spent the weekend resting, playing Bridge, and baking a tuna casserole. Come Monday, he was ready to beat the market.
The portfolio was helped Trumpmendously by the short position in Trump Hotels, and rose 0.54% as the S&P and Nasdaq fell. Since Foolish beginnings in August of 1994, the Fool Port is up 203% against returns of 99% for the S&P.
Let's take a hard left from the usual recap (feel the pressure of the sharp turn?... imagine your face pressing against the side of your chair as you sustain several g's of force; in fact, imagine that you're on the space shuttle coming in for a landing, an ice cream cone in your lap...)
The Fool is proud to have penned a deal with the Universal Press Syndicate! Beginning last week, all-original Fool content has been going to print in forty newspapers across the country, and the list is growing, with several of the largest newspapers in the country onboard. Foolish content is appearing weekly, and includes features such as "Ask the Fool," "The Fool School," "The Fool Scoop," "Name that Company," and "My dumbest Investment." Again, it's all fresh content, found only in the newspapers.
These are the papers in which the Fool is proud to appear, listed alphabetically by state abbreviation (get ready to scroll!):
Birmingham (AL) Post Herald
Phoenix (AZ) Arizona Republic
Tucson (AZ) Arizona Daily Star
Los Angeles (CA) Times
San Bernardino (CA) Sun
Salinas (CA) Californian
Ventura (CA) County Star
Oxnard (CA) Star Free Press
Pleasanton (CA) Valley Times
Walnut Creek (CA) Contra Costa Times
San Ramon (CA) County Times
Richmond (CA) W. County Times
Denver (CO) Rocky Mountain News
Aspen (CO) Daily News
Miami (FL) Herald
Tampa (FL) Tampa Tribune
Atlanta (GA) Constitution
Hays (KS) Daily News
Lawrence (KS) Lawrence Journal World
Jackson (MI) Citizen Patriot
Minneapolis (MN) Star Tribune
Mankato (MN) Free Press
Hollister (MO) Tri Lakes Daily
Jackson (MS) Clarion Ledger
Charlotte (NC) Observer
Durham (NC) Herald Sun
High Point (NC) Enterprise
Bismarck (ND) Tribune
Albuquerque (NM) Journal
Las Cruces (NM) Sun News
Corning (NY) Leader
Warren (OH) Tribune Chronicle
Erie (PA) Times News
Beaver (PA) County Times
Spartanburg (SC) Herald Journal
Bremerton (WA) Sun
Olympia (WA) Olympian
Seattle (WA) Times
What? Your newspaper -- "The Daily Star of Rome" from Southern Illinois -- isn't on the list?
Get on the phone, good Fool, and call your paper's editor! This is named the "Call Your Local Editor" (tm) game, and it's trademarked by the Fool. The game is somewhat like David Gardner's Foolish Gambit, whereby we all go to bookstores across the country and make The Motley Fool Investment Guide (paperback) the most prominent thing in the bookstore. Yeah, it's sickly self-promotional. Sure, it's disgustingly capitalistic. But we've actually written back and forth with most of you through email by now, and we're all friends, and we're not asking anyone to buy anything. Come on!
If you want to enjoy your local newspaper more, you probably need to "Fool" it up! Give the editor a call and let him or her know that you're interested in seeing The Motley Fool within their pages. And those of you in Chicago, give special attention to The Chicago Tribune. In fact, call them twice. It's a great newspaper and I would hate to see it get crushed by the Sun Times, if the Sun happened to pick up the Fool and the Tribune didn't. I'm going to give them a call myself.
It's a joy to read the Fool in weekly print. There's nothing quite like a freshly-printed newspaper, some coffee, and some Foolery to start your day. All of us at Fool HQ are looking forward to it.
Let's hit today's news: Stocks fell. Tech stocks were down the hardest and the Fool Port was no exception -- except, America Online and 3Com managed to rise.
INNOVEX (Nasaq: INVX) surrendered $1/4 as drive-related companies slipped on news of HUTCHINSON TECH's (Nasdaq: HTCH) strong earnings. The company met estimates of $0.68 on a 33% increase in revenues, but stated that next quarter it would see a sequential 5% decrease in unit production due mainly to its ramp up of Trace Suspension Assemblies. Last week WESTERN DIGITAL (NYSE: WDC) missed estimates by one penny, and SEAGATE (NYSE: SEG) missed lowered estimates, too, but growth in the industry is far from lethargic, and much of the lower earnings have been company-based.
AT&T (NYSE: T) chimed in with earnings one penny above estimates, at $0.59 per share. This is 38% below what the company earned last year, but the stock held steady. The company is paying the price now for future growth, management claims, as it continues to work on its long-term plans. Long-distance volume rose over 7%, but revenue from long-distance rose only about 2%, due to competition, free minutes, and lower rates. Total revenues for the quarter increased 2% from last year to $13.2 billion.
On the good side, the company's expenses are dropping comparatively, as the results of cost-cutting is showing on the books. AT&T is working on turning itself into something that can grow again in the years down the road, in an extremely competitive industry. For us, it appears that in the second week of August the Fool will be selling the stock from its Foolish Four holdings, methodically. The current Foolish Four stocks are Philip Morris, General Motors, Exxon, and DuPont. So right now, only General Motors would be kept in the Fool Port, and three new stocks would replace Chevron, AT&T and 3M.
TRUMP HOTELS (NYSE: DJT) should be reporting earnings next week and loss of $0.02 per share is expected. The stock fell 7% today on no apparent news.
One of the Fool's summer interns, Art Bayer (TMF Hoya), and I were talking last week about Trump's plans. It's interesting how Trump wants to sell a property in order to pay down debt (of course that's been "in the plans" before), but is at the same time interested in buying property in Las Vegas and is one of the few remaining bidders for a Detroit casino. The other bidders have dropped out due to the high expense of the project. So, while Trump states from one side of his mouth that he wants to cut back on debt, from the other side he's talking expansion, which would arguably cost more money than what he might rake in for selling one Atlantic City property.
Speaking of summer interns, we have a small handful of them at Fool HQ this season, and they've been great. All very smart, funny, bright college students. It'll be a shame when August rolls around and they depart from Fool HQ.
Summer, we have one request of you, and that is: be Foolish -- meaning, slow down.
Fool Message Boards -- Speak
your Foolish mind!
Boring Portfolio -- Boring is beating the Fool Port.
Fool Four -- 23% annually, historically.
Evening News -- All the latest news and big movers.
Port Tracker -- Update your portfolio daily, easily.
Daily Double -- Too high to keep going?
Daily Trouble -- Is there value in this butchered stock?
Fribble -- A fun short story from readers.
Stock Change Bid ---------------- AOL +1 5/16 65.25 T - 1/16 34.38 ATCT - 1/8 4.00 CHV - 3/4 74.88 DJT - 13/16 10.56 GM +1 56.00 INVX - 1/4 31.75 IOM - 11/16 23.50 KLAC - 1/4 54.63 LU -2 3/8 81.88 MMM + 3/16 98.56 COMS + 5/8 54.50Day Month Year History FOOL +0.54% 7.79% 13.68% 203.39% S&P: -0.26% 3.14% 23.25% 99.16% NASDAQ: -0.71% 6.58% 19.05% 113.41% Rec'd # Security In At Now Change 5/17/95 980 Iomega Cor 2.52 23.50 832.54% 8/5/94 355 AmOnline 7.27 65.25 797.52% 10/1/96 42 LucentTech 47.62 81.88 71.95% 8/12/96 110 Minn M&M 65.68 98.56 50.07% 8/11/95 125 Chevron 50.28 74.88 48.90% 8/24/95 130 KLA-Tencor 44.71 54.63 22.17% 8/13/96 250 3Com Corp. 46.86 54.50 16.30% 6/26/97 325 Innovex 27.71 31.75 14.58% 8/12/96 280 Gen'l Moto 51.97 56.00 7.75% 8/12/96 130 AT&T 39.58 34.38 -13.15% 4/30/97 -1170 *Trump* 8.47 10.56 -24.72% 10/22/96 600 ATC Comm. 22.94 4.00 -82.56% Rec'd # Security In At Value Change 8/5/94 355 AmOnline 2581.87 23163.75 $20581.88 5/17/95 980 Iomega Cor 2594.53 23030.00 $20435.47 8/12/96 110 Minn M&M 7224.44 10841.88 $3617.44 8/11/95 125 Chevron 6285.61 9359.38 $3073.77 8/13/96 250 3Com Corp. 11714.99 13625.00 $1910.01 10/1/96 42 LucentTech 1999.88 3438.75 $1438.87 6/26/97 325 Innovex 9005.62 10318.75 $1313.13 8/24/95 130 KLA-Tencor 5812.49 7101.25 $1288.76 8/12/96 280 Gen'l Moto 14552.49 15680.00 $1127.51 8/12/96 130 AT&T 5145.11 4468.75 -$676.36 4/30/97 -1170*Trump* -9908.50 -12358.13 -$2449.63 10/22/96 600 ATC Comm. 13761.50 2400.00-$11361.50 CASH $40625.59 TOTAL $151694.97