The Daily Dow
Monday, July 21, 1997
by Robert Sheard

LEXINGTON, KY. (July 21, 1997) -- Earnings are still the name of the game on Wall Street. Two current Beating the Dow stocks posted second-quarter numbers today, 1997 laggard AT&T <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: T)") else Response.Write("(NYSE: T)") end if %> and oil giant EXXON <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: XON)") else Response.Write("(NYSE: XON)") end if %>.

AT&T posted earnings of 59 cents a share compared to 95 cents a year ago. Despite the 38% decline, the number was still a penny ahead of First Call's consensus estimate, so the stock was basically unchanged by the news.

The company believes the worst is over. CFO Dan Somers said, "We believe we've seen the low point on earnings" and claimed he was comfortable with analyst estimates of 64 cents for the third quarter and continued growth thereafter.

As we saw last week, however, when John Walter resigned after being told he wasn't going to be named CEO as expected, AT&T is still struggling to get its management act together. They'll have a hard time replacing Walter if they can't name his replacement as CEO from the start. And as long as Robert Allen refuses the relinquish power, that's not going to happen. As Prudential analyst Guy Woodlief put it, "AT&T is operating in a leadership vacuum."

In the oil patch, Exxon managed to beat First Call estimates by nearly 10%, despite lower energy prices for the second quarter. Wall Street was looking for 72 cents a share, but Exxon was able to ring up 79 cents, 25% better than last year's equivalent period.

Exxon's diversity helped it weather the lower oil prices this quarter, with strong results from its chemical division and its network of refineries and service stations. Another element that paid off for Exxon's bottom line was its reduction of outstanding shares. Exxon bought back nearly 15 million shares, valued at roughly $863 million.

(c) Copyright 1997, 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. ________________________________


1997 Foolish Four Model
Stock  Change   Last
--------------------
T    -   1/16  34.38
GM   +1        56.00
CHV  -   3/4   74.88
MMM  +   1/4   98.56

          Day   Month    Year
        FOOL-4   +0.13%  -1.06%   1.08%
        DJIA     +0.21%   2.94%  22.62%
        S&P 500  -0.26%   3.14%  23.25%
        NASDAQ   -0.76%   6.53%  18.99%

    Rec'd   #  Security     In At       Now    Change
   1/2/97  120 3M            83.00     98.56    18.75%
   1/2/97  153 Chevron       65.00     74.88    15.19%
   1/2/97  179 Gen. Motor    55.75     56.00     0.45%
   1/2/97  479 AT&T          41.75     34.38   -17.66%


    Rec'd   #  Security     In At     Value    Change
   1/2/97  120 3M          9960.00  11827.50  $1867.50
   1/2/97  153 Chevron     9945.00  11455.88  $1510.88
   1/2/97  179 Gen. Motor  9979.25  10024.00    $44.75
   1/2/97  479 AT&T       19998.25  16465.63 -$3532.63


                             CASH    $767.60
                            TOTAL  $50540.60