Boring Portfolio Report ALEXANDRIA, Va. (August 23) -- Major market indices closed lower on Friday.
The Dow slipped 10 points, the S&P 500 fell 4 points (-0.54%), and the
Nasdaq eased fractionally. NYSE trading volume was about what you'd expect
for a drowsy Friday in late August: 304 million shares.
The Boring Portfolio lost three-quarters of a percentage point in
n.a.v., as the majority of its holdings incurred fractional losses.
As usual, Cisco hogged most Borefolio-related news today. A full-page
story in this morning's Wall Street Journal focused on (guess what?) The
Internet. This time, the emphasis was Internet gridlock -- you know, the
World Wide Wait, America Offline, the pending "catastrophic collapse" of
the 'net, etc.
All enterprises should have such trouble: thousands of new customers
signing on everyday, traffic from existing customers increasing geometrically.
The "problem" (or, as some might say, the *opportunity*) is that the Internet
infrastructure -- the routers and switches and stuff -- are being overwhelmed
by the data traffic.
As is often the case, the providers of commodity services, in this
case the telcos and internet service providers, are barely scraping by on
their internet biz: huge revenue growth, but little or no profit. On the
other hand, the "companies turning big profits are manufacturers of specialized
equipment needed to run the network, such as Cisco Systems, Inc," according
to the story. True enough.
In addition to the WSJ piece, Utendahl Capital Partners reiterated
its "buy" recommendation on Cisco, noting that the company "dominates the
networking industry and with the completion of the Stratacom acquisition,
maintains a leading position in several key growth markets."
The Utendahl report goes on to note (as we have here in Fooldom)
that "Cisco has the industry's highest gross margins and leads its peers
with the best operating margins," and its revenue growth "is among the highest
in the industry while its PE ratios and price-to-revenue are the lowest among
the fastest growing industry players."
Fat lot of good it did Cisco today, though. The stock slipped $ 5/8
-- although it's still just a few dollars below its all-time high.
A strong July durable goods report rocked the bond market on Friday,
sending interest rates higher and financial stocks, like Green Tree Financial,
lower. GNT lost $ 5/8 today. Zooming back a bit from today's ticker, though,
it should be noted that Green Tree continues to have great success in placing
its asset-backed securities in the secondary market. As a WSJ item noted
this morning, Green Tree's latest offering "defied the conventional wisdom
that big deals can't be placed in August while big investors, especially
in Europe, are on vacation."
Borders also eased fractionally today. Fools in the Boynton Beach,
Fla., area can still make it over to the new Borders there to catch Cinder
Reller the Clown and the jazz group Gas Money at the superstores grand opening.
More stuff will be going on there all week-end.
On a more positive note, Shaw Group fabricated a $1 1/4 advance
to set a new high at $30 3/8 (bid) on impressive volume of 267,000 shares.
That move placed SHAW back at the top of the Borefolio heap, with a 61.2%
gain registered since I acquired the stock on April 12.
Carlisle Companies was the other Borefolio gainer today -- up fifty
cents.
For the week, the S&P 500 gained about a quarter or a percentage
point, and the Nasdaq rose by 0.87%. The Borefolio, in contrast, slipped
0.87%. The Boring Portfolio continues to outperform the market averages (and
the performances of the vast majority of mutual funds) since its inception
on January 29, however.
Somehow, those wintry January days seem far longer ago to me than
they were chronologically. Perhaps the steamy heat here in Alexandria (where
I've come today for some serious fun at Fool HQ) has something to do with
it. Perhaps its the explosive growth in attention that The Motley Fool has
received since then. Whatever the reason, it's been a singularly interesting
and informative experience for me. I hope you've gotten something out of
it, too -- in investment gains, to be sure, but also in education and amusement.
I hope you have a great week-end, as I will.
(c) Copyright 1996, The Motley Fool. All rights reserved. This material
is for personal use only. Republication and redissemination, including posting
to news groups, is expressly prohibited without the prior written consent
of The Motley Fool.
Transmitted: 8/23/96
BGP - 5/8 ...CSL + 1/2 ...CSCO - 5/8 ...GNT - 7/8 ...OXHP - 7/8
*Scroll down or expand screen for full portfolio accounting
Day Month Year History
BORING -0.76% 5.66% 10.68% 10.68%
S&P 500 -0.54% 4.23% 7.31% 7.31%
NASDAQ -0.08% 5.79% 9.81% 9.81%
Rec'd # Security In At Now Change
4/12/96 100 The Shaw Gr 18.84 30.38 61.21%
2/28/96 200 Borders Gro 22.51 33.38 48.25%
2/2/96 200 Green Tree 30.39 37.38 22.99%
1/29/96 100 Texas Indus 54.50 66.50 22.02%
3/8/96 400 Prime Medic 10.07 11.63 15.46%
6/26/96 100 Cisco Syste 53.90 56.88 5.52%
7/23/96 100 S&P Deposit 64.15 66.86 4.22%
8/13/96 100 Carlisle Co 52.65 54.38 3.28%
5/24/96 100 Oxford Heal 48.02 46.13 -3.96%
Rec'd # Security Cost Value Change
2/28/96 200 Borders Gro 4502.49 6675.00 $2172.51
2/2/96 200 Green Tree 6077.49 7475.00 $1397.51
1/29/96 100 Texas Indus 5449.99 6650.00 $1200.01
4/12/96 100 The Shaw Gr 1884.16 3037.50 $1153.34
3/8/96 400 Prime Medic 4027.49 4650.00 $622.51
6/26/96 100 Cisco Syste 5389.99 5687.50 $297.51
7/23/96 100 S&P Deposit 6414.99 6685.94 $270.95
8/13/96 100 Carlisle Co 5264.99 5437.50 $172.51
5/24/96 100 Oxford Heal 4802.49 4612.50 -$189.99
CASH $4428.44
TOTAL $55339.38
Friday, August 23, 1996
...PMSI - 1/8 ...SHAW +1 1/4 ...SPY -23/64...TXI - 5/8 ...