Boring Portfolio Report
ANN ARBOR, Mich. (Sept. 10) -- The Boring Portfolio managed a healthy two-thirds
of a percentage point gain in net value today despite a generally directionless
market. The Dow Jones Industrial Average fell a devilish 6.66 to close at
5,727 on volume of 372 million shares, the NYSE's busiest session in more
than a month. The S&P 500 and the Nasdaq each gained only a fraction
of a point. There's a fair amount of Boring news tonight, so let's get right
to it.
Borders Group tacked a half-point onto yesterday's $1 1/8 gain -- and on
volume of 357,400 shares, too. That's more than triple its average daily
volume. Somebody likes Borders as much as I do, I guess.
Shaw Group was less fortunate today. After slipping $1 1/8 yesterday, SHAW
slid a full $2 today. A colleague of mine told me that he'd called the company
today to ask if they might have an explanation. He was told that analysts
had been calling, as well, but that the company had released no news that
might account for the drop.
I've heard it suggested that a story in today's Wall Street Journal that
mentions problems with energy projects in India might account for the drop
in SHAW. Shaw Group was not mentioned in the story, however. In any event,
my colleague informs me that, according to Shaw Group, India accounts for
less than 5% of their business. As always, I'll follow up and report back
when I learn anything.
Speaking of reporting, in last Friday's and yesterday's Borefolio recaps,
I passed along what I knew about the Health Care Finance Administration's
Medicare rate hike announcements and various published views about what effect
the new rates might have (if any) on OXHP. The rate increases in the New
York metro area (where Oxford does a lot of business) are below what some
analysts had been expecting, and the stock sold off in a knee-jerk reaction
on Friday afternoon and has continued slipping a bit more so far this week.
After the market closed yesterday, Oxford issued a press release in which
they said that "the increase is within the range anticipated by the Company
and will permit us to continue to provide high-quality, cost-effective service
to our more than 110,000 Medicare beneficiaries."
After a couple of rounds of phone tag, I was able to speak to folks at Oxford
today. They told me that they do not anticipate that the new Medicare rates
will hurt the company's business and earnings at all. The CFO's office spent
much of yesterday reaffirming this position with analysts; and as far as
the company knows, no analysts had altered their EPS forecasts.
I asked if the company remained comfortable with the earnings projections
that appeared in a Reuters story just prior to the HCFA report. The reply
I received was affirmative. Those projections, supplied by company CEO Stephen
Wiggins are for $1.22 for 1996 and $1.75 for 1997. By way of comparison,
the consensus estimates supplied by First Call as of yesterday are for $1.20
and $1.68.
Carlisle Companies announced today that it has entered into an agreement
to acquire Hartstone, Inc., "a leading designer and manufacturer of ceramic
tableware, cookware and decorative kitchenware sold through specialty stores,
mail order catalogues and high-end department stores." How wonderfully Boring.
Privately-owned Hartstone operates out of Zanesville, Ohio. Patrick Hart,
President, founder and majority owner, will continue in his current role,
according to the press release. Stephen Munn, Carlisle's Chairman and CEO,
said that Hartstone will mesh well with Carlisle's existing Grainware company.
Terms of the pending transaction, which is expected to close in September
or October of this year, were not disclosed. But apparently the market liked
the news. CSL rose $1 5/8 on healthy (for Carlisle) volume of 33,800 shares.
Finally, we cannot let today pass without noting that shares of Prime Medical
Services crossed (and held above) the $12 mark today -- and on above-average
volume, too. I could find no news.
Tuesday, September 10, 1996
BGP + 1/2 ...CSL +1 5/8 ...CSCO ---...GNT + 1/2 ...OXHP - 3/8 ...
PMSI + 7/8 ...SHAW -2...SPY - 3/64...TXI -1 1/8 ...
*Scroll down or expand screen for full portfolio accounting
Day Month Year History
BORING +0.67% -0.05% 7.84% 7.84%
S&P 500 +0.01% 1.81% 6.79% 6.79%
NASDAQ +0.06% 0.69% 10.42% 10.42%
Rec'd # Security In At Now Change
4/12/96 100 The Shaw Gr 18.84 28.38 50.60%
2/28/96 200 Borders Gro 22.51 33.25 47.70%
3/8/96 400 Prime Medic 10.07 12.13 20.42%
1/29/96 100 Texas Indus 54.50 64.25 17.89%
2/2/96 200 Green Tree 30.39 35.63 17.24%
7/23/96 100 S&P Deposit 64.15 66.67 3.93%
8/13/96 100 Carlisle Co 52.65 54.00 2.56%
6/26/96 100 Cisco Syste 53.90 54.25 0.65%
5/24/96 100 Oxford Heal 48.02 41.13 -14.37%
Rec'd # Security Cost Value Change
2/28/96 200 Borders Gro 4502.49 6650.00 $2147.51
2/2/96 200 Green Tree 6077.49 7125.00 $1047.51
1/29/96 100 Texas Indus 5449.99 6425.00 $975.01
4/12/96 100 The Shaw Gr 1884.16 2837.50 $953.34
3/8/96 400 Prime Medic 4027.49 4850.00 $822.51
7/23/96 100 S&P Deposit 6414.99 6667.19 $252.20
8/13/96 100 Carlisle Co 5264.99 5400.00 $135.01
6/26/96 100 Cisco Syste 5389.99 5425.00 $35.01
5/24/96 100 Oxford Heal 4802.49 4112.50 -$689.99
CASH $4428.44
TOTAL $53920.63