Boring Portfolio Report
Tuesday, December 24, 1996

by Greg Markus (MF Boring)

ANN ARBOR, Mich. (Dec. 24) -- Stocks rose in an abbreviated Christmas Eve session, and that suits me just fine -- both the rising part and the abbreviated part.

The DJIA gained 33 points, or 0.52%. That makes six "up" days in a row for the Dow. The S&P 500 advanced approximately one-half percent, also, while the Nasdaq gained a bit more: +0.62%.

The Boring Portfolio, true to its name, rose a somnolent 0.13%. Five Boring stocks closed higher, three fell, and one (Prime Medical) was unchanged. I spotted no news on any Boring issues today. I do see, though, that the weekly update of First Call data is out on AOL today.

According to First Call, one analyst increased earnings estimates for Cisco during the past week. With Cisco's consensus EPS estimate at $2.39 for calendar year 1997, and with 35% near- and long-term annual EPS growth projected, my pocket calculator provides a target price of $84 -- which could appear in time to greet the summer solstice.

While Cisco is a bargain priced 35% plus grower, Oracle shares offer "merely" fairly priced 30-35% growth at a current price in the low $40s. Analysts are forecasting EPS of $1.42 for Oracle's fiscal year ending May 1997. That would represent a 34% advance over FY96 -- a bit above the FY97 p/e.

Green Tree Financial is among the most attractively valued stocks in the Boring bunch at the moment, based on the First Call data. A couple of analysts moved their GNT earnings estimates around slightly during the past week, but the consensus numbers remain unchanged at $2.18 for 1996 and $2.97 for 1997. That implies 36% growth during the coming year, folks. Yet at $38, the stock is trading at less than 13-times projected 1997 per-share earnings. Green Tree has easily carried a market multiple in past years. Even with that relatively conservative multiple, fair value on Green Tree could approach $60 by mid-1997.

Earnings estimates for Prime Medical remain unchanged this week, at $0.74 per share for 1997. With analysts expecting annual EPS growth in the 30% range for the next few years, a little math suggests that PMSI could double within six months. If that sounds implausible, consider that the stock was already north of $20 earlier this year -- and that was before the company more than doubled in size! Was the stock a bit ahead of itself then? Yup. But does $20-$24 sound reasonable by mid-'97 in light of its record to date and its prospects for 1997 and beyond? It does to me -- and to the six analysts who follow the stock.

Cisco, Oracle, Green Tree, Prime Medical ... all terrific growth stocks of leading companies in their respective businesses -- and all trading at or below their projected long-term earnings growth rates. Those are pretty rare gems in today's market. And we've got five more jewels in Borders, Oxford Health, Carlisle Companies, Solectron, and our latest addition, Tidewater.

Gems? Jewels? That reminds me! I've still got a couple of presents to pick up this afternoon!

Merry Christmas, folks.

Stock  Change    Bid
--------------------
BGP   +  1/4   35.25
CSL   +  1/8   58.50
CSCO  +  1/2   64.88
GNT   -  1/4   38.00
ORCL  +  3/4   43.13
OXHP  -  1/2   58.00
PMSI  ---      11.25
SLR   -  1/4   53.25
TDW   +  1/8   46.75

                   Day   Month    Year  History
        BORING   +0.13%  -3.79%  15.20%  15.20%
        S&P 500  +0.55%  -0.79%  20.82%  20.82%
        NASDAQ   +0.64%  -0.39%  23.70%  23.70%

    Rec'd   #  Security     In At       Now    Change

  2/28/96  200 Borders Gr    22.51     35.25    56.58%
   2/2/96  200 Green Tree    30.39     38.00    25.05%
  5/24/96  100 Oxford Hea    48.02     58.00    20.77%
  6/26/96  100 Cisco Syst    53.90     64.88    20.36%
   3/8/96  400 Prime Medi    10.07     11.25    11.73%
  8/13/96  100 Carlisle C    52.65     58.50    11.11%
 12/23/96  100 Tidewater I   46.52     46.75     0.48%
 10/15/96  100 Solectron     54.52     53.25    -2.34%
 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   7050.00  $2547.51
   2/2/96  200 Green Tree  6077.49   7600.00  $1522.51
  6/26/96  100 Cisco Syst  5389.99   6487.50  $1097.51
  5/24/96  100 Oxford Hea  4802.49   5800.00   $997.51
  8/13/96  100 Carlisle C  5264.99   5850.00   $585.01
   3/8/96  400 Prime Medi  4027.49   4500.00   $472.51
 12/23/96  100 Tidewater I  4652.49   4675.00    $22.51
 10/15/96  100 Solectron   5452.49   5325.00  -$127.49
 11/21/96  100 Oracle Cor  4864.99   4312.50  -$552.49


                             CASH   $5999.08
                            TOTAL  $57599.08



Transmitted: 12/24/96