Boring Portfolio Report
Tuesday, December 17, 1996

by Greg Markus (MF Boring)

ANN ARBOR, Mich. (Dec. 17) -- Hurray! The Fed ended its policy meeting today leaving interest rates untouched, and even though almost no one thought it would do otherwise, traders decided this was sufficiently good news to arrest the December market correction.

The DJIA rose 40 to close a few points above 6300 on trading volume of 520 million shares. The Nasdaq and the S&P 500 each rose about 5 points. That works out to +0.42% for the Naz and +0.70% for the S&P.

The Boring Portfolio managed a 0.57% advance, with six stocks up and only two (Cisco and Solectron) closing lower.

After the closing bell yesterday, Solectron reported quarterly earnings of $0.63 per share, not counting a nickel in non-recurring charges associated with the merger of Force Computers. Although that matched the consensus of analysts' estimates, it wasn't sufficient to please the analyst over at Alex Brown. He cut his rating on the stock to "neutral" from "buy."

Later in the day, Solectron's VP of Finance, Dick Gilpin, told a Reuters reporter that the company remains "on-stream" to meet consensus earnings estimates for its current quarter (ending in February) and for fiscal 1997. Gilpin said the First Call consensus EPS estimate of $2.75 for fiscal 1997 was "reasonable" and the company was comfortable with mean EPS estimate of $0.65 for the second quarter.

I'll be following up with Solectron later this week, as The Motley Fool was not able to participate in the conference call with analysts. According to Reuter, the company reiterated its plans to step-up its business in building complete computer "boxes," rather than just the electronic boards, over the next two to three years -- to the point where it will account for up to 30% of the company's revenues. This may have disappointed some analysts, because box-building is a lower margin activity.

The company's response is that it can run at optimum efficiency with this mix and expects to "maintain its return on investment levels through higher asset utilization and inventory turn levels."

Elsewhere in the Borefolio, Green Tree shot up $1 3/8, perhaps nurtured by the news from the Fed. Green Tree just rolled out its latest asset-backed securitization, this one consisting of $380 million of consumer-loan backed securities.

Shares of Oxford Health, Borders Group, Prime Medical, Carlisle, and Oracle all rose today. All of that was much appreciated here, even if there's no specific news to account for it.

Stock  Change    Bid
--------------------
BGP   +  1/2   34.00
CSL   +  1/4   58.50
CSCO  -  1/2   62.75
GNT   +1 3/8   38.00
ORCL  +  5/8   43.13
OXHP  +1 3/8   57.38
PMSI  +  1/4   11.63
SLR   -3 1/4   54.63

                   Day   Month    Year  History
        BORING   +0.57%  -4.23%  14.68%  14.68%
        S&P 500  +0.70%  -4.09%  16.80%  16.80%
        NASDAQ   +0.42%  -2.03%  21.65%  21.65%

    Rec'd   #  Security     In At       Now    Change

  2/28/96  200 Borders Gr    22.51     34.00    51.03%
   2/2/96  200 Green Tree    30.39     38.00    25.05%
  5/24/96  100 Oxford Hea    48.02     57.38    19.47%
  6/26/96  100 Cisco Syst    53.90     62.75    16.42%
   3/8/96  400 Prime Medi    10.07     11.63    15.46%
  8/13/96  100 Carlisle C    52.65     58.50    11.11%
 10/15/96  100 Solectron     54.52     54.63     0.18%
 11/21/96  100 Oracle Cor    48.65     43.13   -11.36%


    Rec'd   #  Security     In At     Value    Change

  2/28/96  200 Borders Gr  4502.49   6800.00  $2297.51
   2/2/96  200 Green Tree  6077.49   7600.00  $1522.51
  5/24/96  100 Oxford Hea  4802.49   5737.50   $935.01
  6/26/96  100 Cisco Syst  5389.99   6275.00   $885.01
   3/8/96  400 Prime Medi  4027.49   4650.00   $622.51
  8/13/96  100 Carlisle C  5264.99   5850.00   $585.01
 10/15/96  100 Solectron   5452.49   5462.50    $10.01
 11/21/96  100 Oracle Cor  4864.99   4312.50  -$552.49

                             CASH  $10651.57
                            TOTAL  $57339.07



Transmitted: 12/17/96