Fool Portfolio Report
Friday, November 14, 1997
by David Gardner (DavidG@fool.com)


ALEXANDRIA, VA (Nov. 14, 1997) -- The Fool Portfolio had a market-beating Friday... sheeesh, it's nice to have ONE good day a week. At the gong of the final bell, the Portfolio showed a daily take of 1.69%, barely outpacing a strong Nasdaq (up 1.65%) and gaining back some of the huge ground lost recently to the S&P 500 (up 1.28%).

For the week, Folly slid 3.66% in value, while the Nasdaq lost a percent and the S&P 500 actually showed an infinitesimal GAIN.

It was a very unpleasing week to be an owner of the Fool Portfolio, with today taking a teensy bit of the sting out of the hornet.

That said, you have to remember that the sinking feeling some of us felt this week can occasionally -- check that, WILL occasionally -- dog you for a whole year! Even, a whole three or five years, rarely. As equities investors, we know that while the pile of gold coins heaps up mightily over the decades, at various points along the way you'll hear a quick jingle and POOF! A bunch of your coins just vanished into thin air. We got POOFed this week. We might get POOFed next week, or in '98. Dem's da berries.

Helping out the Foolfolio today were, yes Virginia, America's brokerage firms. America Online (NYSE: AOL) got an upgrade to "near-term accumulate" from ten-ton gorilla Merrill Lynch, restoring $4 13/16 in lost value. (Two days ago, the company announced the issuance of $350 million in convertible notes. We covered that minor news in the Thursday recap.) And 3Com (Nasdaq: COMS) got a reiterated "buy" (albeit with cut estimates) from Bear Stearns. Up most of the day, the stock sagged in late afternoon and surrendered a "s'teenth." And yet, COMS only losing $1/16 somehow feels like victory to me.

(Isn't that sick? Heck, I don't know which is sicker: 3Com or demoralized shareholders like me who also happen to be fighting a slight case of laryngitis.)

My brother Tom put up his feelings and analysis on 3Com yesterday, if you've not yet had a chance to click in and read.

Now even though disk-drive industry stocks were practically erased over the week -- storage giants Western Digital (NYSE: WDC) and Read-Rite (Nasdaq: RDRT) reporting future earnings disappointments for various reasons -- our own Innovex (Nasdaq: INVX) was able to end the five days almost flat, down only a fraction. The company doesn't face the same pricing competition as drive makers, because it already dominates its niche with the lowest-priced product. That, and of course the stock has already dropped 10 points (a third of its value over the past month plus). On Monday the Evening News wrote about the drive industry, and on Tuesday we called Innovex and got the word from management regarding IBM's (NYSE: IBM) new disk drive.

Like America Online, Amazon.com (Nasdaq: AMZN) also lined up additional funds this week, though Amazon used a $75 million line of credit agreement with Deutsche Morgan Grenfell, Inc.

Iomega (NYSE: IOM) released a cache of new announcements, including a 2-for-1 stock split to be completed around December 22. For more thoughts on the new products due out next year under the n-hand technology umbrella (namely, Clik!), give the IOM message board a spin.

Finally, this week we announced the Fool Charity Fund. My e-mailbox was filled by dawn the next morning with 50+ outstanding notes of affectionate support. Thank you to each of you (I'm writing you all back personally), and we're as excited as you about the venture. In fact, we've now opened a Fool Charity Fund message folder because we really want to learn and discuss additional ideas and receive feedback and suggestions from fellow Fools with lots of experience in the non-profit field. And by the way, we're not the only ones excited about all this. I got a note just today from the director of one of our community kitchen sites in Kentucky:

"As the director of Dare to Care, one of the community kitchen partners [in Lexington], I would like to say thanks for creating this great idea. I have heard from several people who are 'Fools' and who know about Dare to Care and the St. Vincent de Paul Society project for job training. The food produced during the training will be going to our Dare to Care Kids Cafes, where high-risk children are fed evening meals. Thanks for what you are doing; obviously, we wish you the greatest success not only in this venture but in all your work."

No better note to end on.

Foolishly,

David Gardner, November 14, 1997

Today's FoolWatch: all the latest in Fooldom.


TODAY'S NUMBERS

Stock Change Bid ---------------- AMZN +3 3/8 49.63 AOL +4 13/16 73.31 T - 3/4 48.00 CHV +1 15/16 83.94 DJT - 1/16 8.56 GM -1 1/16 61.19 INVX + 5/8 25.13 IOM - 1/4 28.69 KLAC + 1/4 41.75 LU +2 7/16 81.19 MMM - 5/16 94.75 COMS - 1/16 30.25
Day Month Year History FOOL +1.69% -3.49% 19.76% 219.61% S&P: +1.28% 1.50% 25.33% 102.52% NASDAQ: +1.65% -0.63% 22.65% 119.88% Rec'd # Security In At Now Change 5/17/95 980 Iomega Cor 2.52 28.69 1038.39% 8/5/94 355 AmOnline 7.27 73.31 908.03% 10/1/96 42 LucentTech 47.62 81.19 70.50% 8/11/95 125 Chevron 50.28 83.94 66.92% 8/12/96 110 Minn M&M 65.68 94.75 44.27% 9/9/97 290 Amazon.com 38.22 49.63 29.84% 8/12/96 130 AT&T 39.58 48.00 21.28% 8/12/96 280 Gen'l Moto 51.97 61.19 17.73% 4/30/97 -1170 *Trump* 8.47 8.56 -1.11% 8/24/95 130 KLA-Tencor 44.71 41.75 -6.62% 6/26/97 325 Innovex 27.71 25.13 -9.33% 8/13/96 250 3Com Corp. 46.86 30.25 -35.45% Rec'd # Security In At Value Change 5/17/95 980 Iomega Cor 2509.60 28113.75 $25604.15 8/5/94 355 AmOnline 2581.87 26025.94 $23444.07 8/11/95 125 Chevron 6285.61 10492.19 $4206.58 9/9/97 290 Amazon.com 11084.24 14391.25 $3307.01 8/12/96 110 Minn M&M 7224.44 10422.50 $3198.06 8/12/96 280 Gen'l Moto 14552.49 17132.50 $2580.01 10/1/96 42 LucentTech 1999.88 3409.88 $1410.00 8/12/96 130 AT&T 5145.11 6240.00 $1094.89 4/30/97 -1170*Trump* -9908.50 -10018.13 -$109.63 8/24/95 130 KLA-Tencor 5812.49 5427.50 -$384.99 6/26/97 325 Innovex 9005.62 8165.63 -$840.00 8/13/96 250 3Com Corp. 11714.99 7562.50 -$4152.49 CASH $32438.81 TOTAL $159804.31