Fool Portfolio Report
Thursday, January 29, 1998
by David Gardner (DavidG@fool.com)

ALEXANDRIA, VA (Jan. 29, 1998) -- Nice to see back-to-back market-beating days for the Fool Portfolio. Yesterday, it was the triumphant estimate-smasher 3Dfx at the tip of the Fool vanguard, bearing our motley standard. Today it's the beaten-down and harrassed Iomega, bouncing back $11/16 (geez, that counts for 8.5% at these low prices!).

That's not to say we didn't receive strong ongoing support from some stalwarts on both days, like Amazon (up another $2 1/4 today), and our dear old friend Spidey (gaining another $23/32... gotta love those thirty-seconds, don'tcha?). Spidey will jitter with the market, as you know... and if you didn't know this, it's time to acquaint yourself with this pleasing alternative to index funds. Go directly to our Spider buy report explanation, do not pass "Go," and don't collect 200 bucks... yet.

OK, a quick look at today's news before a slower look at an important item from yesterday.

Iomega announced today that it had its "Zip Built-In" (tm) to another system, but this one is unusual. No desktop computer, this. This is actually a state-of-the-art sound system from Roland Corporation, the new VS-840 Digital Studio Workstation. It will enable its customers to record 100 minutes of audio directly onto each 100-megabyte Zip disk. When you consider these things are removable, you start picturing some of the cool uses. (Record it on the hot new VS-840 your dad bought you, then take it over to your girlfriend's Dell and play it for her family.)

The press release points out this is the second non-PC use for the Zip, the first being its incorporation into a presentation projector from InFocus Systems. These little disks are getting rather flexible and insidious, aren't they? Now, I doubt that the Roland announcement was enough to bump the stock up $11/16, but I think IOM shareholders were due some payback anyway. So we'll take what we can get, right? Go Roland, baby.

Next up was Innovex, the company that now trades at a P/E (prepare yourselves, ladies, gentlemen, and Fools) of EIGHT. I understand why this niche company with 22% profit margins on $150 million in sales is trading low... the reason is that the hard-drive industry is out of favor right now, and Innovex's product is not a SURE THING to be incorporated into the hard drives of the future. But we've never believed anything's a sure thing, and we remain confident in Innovex. As if to thumb its nose at the naysayers (that's actually silly -- completely not the company's attitude), INVX management bumped the quarterly dividend up a half-cent today. Attaboy.

Now to more interesting news. We didn't get a chance to mention this yesterday, as we didn't get the info till too late. But we have now seen revisions in earnings estimates for 3Dfx by all analysts, upward revisions of a most pleasing scale.

Consensus for calendar (and fiscal) 1998 had been 50-54 cents per share, but then came the blowout earnings report for 4Q '97 on Tuesday of this week. Lo and behold, the conference calls were held (analysts only?!!), the Wall Street fellas processed their numbers, and new estimates were spat out, lickety-split:

Robertson Stephens: 0.92
Buckingham Research: 0.98
Montgomery: 1.00
UBS Securities: 1.01
CIBC Oppenheimer: 1.11

This all according to First Call, initially brought to our attention by fellow Fool Piranha3, on our Web boards. The new, current consensus is $1.00 for FY98.

What a difference a quarter makes, eh?

Now before you go running to the phone shouting, "Honey, YOU put the kids to bed. I have to call our broker!" and placing a trade for another 200 shares of TDFX, let me make it quite clear that this information has already been out as of midday Wednesday. Meaning that it was part of what drove 3Dfx's stock up $4 3/4 yesterday. And the stock went on to give back $1 3/4 of that today, having that profit-taking feel to it (no news on the company today).

Anyway, the situation over in 3Dville continues to look stronger. Bravo, Greg Ballard (our esteemed manager) and co.

(WHOA there! Do we detect some cheerleading from the Fools? What-ever. We're shareholders... we give praise where it's due, but we're also sometimes unhappy shareholders, as well... SO IF IOMEGA WOULD PLEASE LEARN TO BRING ITS NEW PRODUCTS OUT ON TIME, AND COMMUNICATE BETTER WITH THE INVESTMENT PUBLIC, we'll like you more once again, too.)

(Rant concluded.)

Finally today, Chevron began oil production in its Moran field in Papua New Guinea. Papua New Guinea -- I've always wanted to travel there! (That's a roughin'-it trip, of course.) One of the more amazing countries in the world... so mountainous that entirely different languages and cultures have evolved there, just one mountain apart, for centuries.

Chevron is the world's only oil producer with operations in Papua. That strikes me as a suitably Foolish note to close on.

-- David Gardner, January 29, 1998

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TODAY'S NUMBERS

Stock Change Bid ---------------- AMZN +2 1/4 59.50 AOL + 5/8 95.25 T +1 63.06 CHV + 13/16 76.94 DJT - 1/16 9.75 GM + 7/8 60.13 INVX - 1/2 20.63 IOM + 11/16 8.81 KLAC -1 9/16 36.38 LU +3 1/16 90.00 MMM + 7/8 85.38 RTN.A + 1/8 52.06 COMS + 1/2 32.38 TDFX -1 3/4 25.25 SPY + 23/32 98.44
Day Month Year History FOOL +1.35% -5.87% -5.87% 215.92% S&P: +0.82% 1.55% 1.55% 114.99% NASDAQ: +0.54% 3.13% 3.13% 124.87% Rec'd # Security In At Now Change 8/5/94 355 AmOnline 7.27 95.25 1209.66% 5/17/95 1960 Iomega Cor 1.28 8.81 588.26% 10/1/96 42 LucentTech 47.62 90.00 89.01% 8/12/96 130 AT&T 39.58 63.06 59.34% 9/9/97 290 Amazon.com 38.22 59.50 55.67% 8/11/95 125 Chevron 50.28 76.94 53.00% 8/12/96 110 Minn M&M 65.68 85.38 29.99% 8/12/96 280 Gen'l Moto 48.74 60.13 23.35% 1/8/98 115 S&P Depos. 95.91 98.44 2.64% 1/8/98 425 3Dfx 25.67 25.25 -1.63% 12/19/97 17 Raytheon 53.21 52.06 -2.16% 4/30/97 -1170 *Trump* 8.47 9.75 -15.13% 8/24/95 130 KLA-Tencor 44.71 36.38 -18.65% 6/26/97 325 Innovex 27.71 20.63 -25.57% 8/13/96 250 3Com Corp. 46.86 32.38 -30.92% Rec'd # Security In At Value Change 8/5/94 355 AmOnline 2581.87 33813.75 $31231.88 5/17/95 1960 Iomega Cor 2509.60 17272.50 $14762.90 9/9/97 290 Amazon.com 11084.24 17255.00 $6170.76 8/11/95 125 Chevron 6285.61 9617.19 $3331.58 8/12/96 280 Gen'l Moto 13647.92 16835.00 $3187.08 8/12/96 130 AT&T 5145.11 8198.13 $3053.02 8/12/96 110 Minn M&M 7224.44 9391.25 $2166.81 10/1/96 42 LucentTech 1999.88 3780.00 $1780.12 1/8/98 115 S&P Depos. 11029.25 11320.31 $291.06 12/19/97 17 Raytheon 904.57 885.06 -$19.51 1/8/98 425 3Dfx 10908.63 10731.25 -$177.38 8/24/95 130 KLA-Tencor 5812.49 4728.75 -$1083.74 4/30/97 -1170*Trump* -9908.50 -11407.50 -$1499.00 6/26/97 325 Innovex 9005.62 6703.13 -$2302.50 8/13/96 250 3Com Corp. 11715.99 8093.75 -$3622.24 CASH $10740.46 TOTAL $157958.02