The Daily Dow
Wednesday, September 17, 1997
by Rick Aristotle (TMF Edible)
ALEXANDRIA, VA (Sept. 17, 1997) --So, Robert Sheard is away. In his place, a few of us who collectively prefer to be known as "Fools without Book Deals" are here, trashing his temple as he puts the finishing touches on what is shaping up to be the next best thing since chocolate met peanut butter under a Dairy Queen blender.
That said, on Monday my Foolish chum and Gaming Industry Host Paul Larson said we would cover the battle between PHILIP MORRIS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MO)") else Response.Write("(NYSE: MO)") end if %> and AT&T <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: T)") else Response.Write("(NYSE: T)") end if %> for the most lucrative of Foolish Four slots, the double up.
It's a conspiracy, man! Smokers worldwide know it. Shares of the tobacco and food giant are being snuffed out. We took the ten highest yielding Dow stocks. We looked at the five with the lowest price tags. We doubled up on the second cheapest and omitted the cheapest. So no MO.
It wasn't always this way. Back in the spring, Philip Morris had the dubious double slot. But no sooner were Foolish Four certificates being engraved with "Doubling Philip Morris may be hazardous to your health" warnings, AT&T lapped it. Again. It was fixed. Like the Black Sox scandal. Say it ain't so MO!
I figured socially conscious investing had no place in a proven mechanical system like this. An automaton does not know morality, ethics, or tobacco leaves. I thought the beleaguered Flip Mo would have a shot. The telco heavy would slip to the bottom rung come judgment day and the switch would be made. And in the back of your mind, a little voice would say, "Thank you for using AT&T." Because you did.
Yet, trading day after trading day, the maker of Marlboro is keeping double arms distance to AT&T and holding a cigarette-lit vigil in the cellar. Marlboro? Man, someone strap an 8mm camera onto Zapruder, we're going in!
As of today Morris is all of $2 7/16 away from the mother of all bells. That is a heavy $5.85 billion in market cap, but hey, that's lawsuit settlement chump change by tobacco standards.
And it's not as if AT&T isn't taunting Philip Morris. Today the board of directors at Big T announced that the naming of CEO Robert Allen's successor is not imminent. There was speculation that his replacement would be decided at this weekend's board meeting. Disillusioned, Brown Brothers Harriman downgraded the stock to "hold" from "buy." Fitting that a phone company should be put on hold, don't you think?
Yet it has to be said that Philip Morris is not all smokes. We are talking wholesome Jell-o pudding snacks and Kraft cheeses. No smoke, but plenty of mirrors. And the mirror reflects a simple ranking. One in which all is cut and dry. Simple. Mirrors and past performance don't lie, do they? Short of a spring fling can this unemotional system be growing a conscience? What's next, politically correct darts?
The truth is out there. And I pity the Fool who ever stops
(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. ________________________________
Stock Change Last -------------------- T -1 1/16 43.69 GM - 1/2 68.38 CHV - 7/16 86.63 MMM + 7/16 89.00
Day Month Year
FOOL-4 -1.04% 9.73% 16.22%
DJIA -0.12% 3.46% 22.30%
S&P 500 -0.28% 4.84% 27.31%
NASDAQ -0.13% 4.99% 29.08%
Rec'd # Security In At Now Change
1/2/97 153 Chevron 65.00 86.63 33.27%
1/2/97 179 Gen. Motor 55.75 68.38 22.65%
1/2/97 120 3M 83.00 89.00 7.23%
1/2/97 479 AT&T 41.75 43.69 4.64%
Rec'd # Security In At Value Change
1/2/97 153 Chevron 9945.00 13253.63 $3308.63
1/2/97 179 Gen. Motor 9979.25 12239.13 $2259.88
1/2/97 479 AT&T 19998.25 20926.31 $928.06
1/2/97 120 3M 9960.00 10680.00 $720.00
CASH $1009.44
TOTAL $58108.50