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Day, Short Report
Monday, April 13, 1998
by David Gardner ([email protected]) and
Jeff Fischer ([email protected])
ALEXANDRIA, VA (April 13, 1998) -- The Fool Portfolio put a little bit more space between itself and the competing indices today, rising 0.89% vs. a mixed, and rather dull, market. The Fool sports a 1998 return of 18.07% compared to gains of 14.35% and 16.21% for the S&P 500 and Nasdaq, respectively.
This portfolio report was slapped together rather hastily by the Fool Portfolio's two co-managers, David Gardner and Jeff Fischer. (There was too much work at Fool HQ today!) So allow us to comment quickly.
What we found most interesting about today is that in a flat market, we scored nearly a 1% gain without any help from America Online (unchanged) and Amazon.com (down $15/16). It was the performance of our Foolish Four stocks, supplemented by healthy comebacks in KLA-Tencor and Iomega, which carried Folly forward.
Our recent Fool Four purchase, International Paper (NYSE: IP), cut $2 13/16 higher, or nearly 6%, to close at $51 per share. The paper giant's stock rose on speculation that the industry's inventory levels are below the average level for this time of year. This speculation might lay waste (or so we'll say today) to the theory that the Internet could make paper obsolete. Of course that's a ludicrous notion. As long as there are paper clips, we'll need paper. (That was Jeff's non sequitur. E-mail him your appreciation, particularly if you'd like to see more non sequiturs in our recaps.)
Fool Four brethren Exxon (NYSE: XON) rose 1.40% on an analyst upgrade to "market outperformer." So, exactly what does that oft-repeated term mean? Simply that from now until the analyst changes his or her opinion on Exxon, it's expected that the stock will beat the S&P 500 index. In this case, we'll see if Goldman Sachs is correct, God bless 'em.
Meanwhile, DuPont (NYSE: DD) has crushed the market since our February 20 purchase, rising over 26%. That included another new high today for our reorganizing company, climbing $2. DuPont announced the opening of a new digital prepress lab -- OK, yes, cool, but the stock rose for any number of other reasons. (Or none at all?! Ah, well, more people were buying than selling.)
Iomega (NYSE: IOM) rebounded from a recently suffered 52-week low. Japan's Fujitsu PC Corp. agreed to include notebook Zip drives as standard equipment with Fujitsu's LifeBook line of notebook computers. (Mouthful, that one.) Iomega's earnings will be announced on Thursday. Of course, "earnings" is the wrong word, because a loss is expected at the company for the first time in over two years. Three cents per share are presently expected to bleed from Iomega's books during the quarter just completed. That's about $8 million... much of it possibly having been spent on advertising! Stay tuned... this investment story promises to remain interesting.
Some lucky Fool next Monday will win $2000 for the smartest post about how to turn Iomega around. That contest is now completed, the winner to be announced by next Monday, but you can click in to our How to Save Iomega message folder and read a host of stimulating responses... one of them somewhere wrapped in that Willy Wonka golden foil.
Speaking of earnings, Intel (Nasdaq: INTC) releases its most recent results on Tuesday afternoon, and of more relevance to us, 3Dfx (Nasdaq: TDFX) is expected to share its numbers this week as well (we currently believe this to be happening at market close, Thursday). A 443% increase from last year, to $0.24 per share, is expected.
Though seemingly gasping for breath over the past year, networking behemoth 3Com (Nasdaq: COMS) continues to pump out new and often award-winning products. Today our biggest loser announced a new software product called DynamicAccess. The software brings intelligence to network interface cards (NICs), a market that 3Com handily dominates. Our only complaint is that this market is lower margin and more commoditized than many other niches in the networking industry -- alongside with modems, another one of 3Com's specialties since merging with U.S. Robotics.
We're most happy when we see 3Com selling more high-end products. In that light, today 3Com also announced a new repeater product, the SuperStack II hub 1000 SX. (It sounds like it could fly if you just add water.) What this repeater does do, though, is offer "Ethernet Gigabyte switch performance at hub prices," as the company states. It's accurate to say that the company isn't aiming this particular product at the average ma and pa that live next door to you, and that your average 66 MHz computer doesn't really need it.
If you're in Boston (Tuesday) or Cleveland (Wednesday), or have friends or family there, Tom and I (David) will be at local bookstores speaking, answering questions, and signing books. For more info, click here. Look forward to seeing you there!
Meantime, Fool on!
-- David and Jeff, April 13, 1998
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Day Month Year History FOOL +0.89% 5.18% 18.07% 296.25% S&P: -0.09% 0.72% 14.35% 142.08% NASDAQ: +0.26% -0.59% 16.21% 153.40% Rec'd # Security In At Now Change 8/5/94 710 AmOnline 3.64 73.50 1921.21% 5/17/95 1960 Iomega Cor 1.28 6.88 436.94% 10/1/96 84 LucentTech 23.81 67.88 185.09% 9/9/97 290 Amazon.com 38.22 94.31 146.75% 8/12/96 130 AT&T 39.58 64.31 62.50% 2/20/98 215 DuPont 59.83 75.88 26.81% 1/8/98 115 S&P Depos. 95.91 110.88 15.61% 4/30/97 -1170*Trump* 8.47 7.88 7.01% 2/20/98 270 Int'l Pape 47.69 51.00 6.94% 2/20/98 200 Exxon 64.09 67.69 5.61% 1/8/98 425 3Dfx 25.67 26.75 4.22% 6/26/97 325 Innovex 27.71 25.25 -8.88% 8/24/95 130 KLA-Tencor 44.71 39.00 -12.77% 8/13/96 250 3Com Corp. 46.86 32.06 -31.58% Rec'd # Security In At Value Change 8/5/94 710 AmOnline 2581.87 52185.00 $49603.13 9/9/97 290 Amazon.com 11084.24 27350.63 $16266.39 5/17/95 1960 Iomega Cor 2509.60 13475.00 $10965.40 10/1/96 84 LucentTech 1999.88 5701.50 $3701.62 2/20/98 215 DuPont 12864.25 16313.13 $3448.88 8/12/96 130 AT&T 5145.11 8360.63 $3215.52 1/8/98 115 S&P Depos. 11029.25 12750.63 $1721.38 2/20/98 270 Int'l Pape 12876.75 13770.00 $893.25 2/20/98 200 Exxon 12818.00 13537.50 $719.50 4/30/97 -1170*Trump* -9908.50 -9213.75 $694.75 1/8/98 425 3Dfx 10908.63 11368.75 $460.13 8/24/95 130 KLA-Tencor 5812.49 5070.00 -$742.49 6/26/97 325 Innovex 9005.62 8206.25 -$799.37 8/13/96 250 3Com Corp. 11715.99 8015.63 -$3700.37 CASH $11233.54 TOTAL $198124.42
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