HEROES

Graphics card company STB SYSTEMS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: STBI)") else Response.Write("(NASDAQ: STBI)") end if %> rose $2 5/8 to $21 7/8 on releasing a new product bundle including MechWarrior and its 3-D system for web browsers. The bundle will also contain a TV tuner, which might be ridiculed by those who think that separating the TV and the PC should be as sacrosanct as separating church and state. However, it is quite handy to pop into CNN or SportsCenter when doing something on the computer -- software development possibilities will also grow as certain cards become standard. If all those ideas don't blow your hair back, the company also mentioned flat panel display support and the INTEL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: INTC)") else Response.Write("(NASDAQ: INTC)") end if %> Intercast, which puts forth the notion that ubiquitous desktop teleconferencing is on the way.

ZOLTEK COMPANIES INC. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: ZOLT)") else Response.Write("(NASDAQ: ZOLT)") end if %> rose $3 1/2 to $32, fulfilling some of the promise investors had built into the company's valuation earlier this year. Despite all the wailing and whining of a certain editor with a Friday night deadline, there's much to admire when a company produces topline growth of 450% and earnings growth of 220%. The company's price-earnings ratio is now much smaller than the growth rate, which suggests that this is a real story and isn't a ridiculous valuation. Throughout the controversies of early 1996, the company's Chief Executive Officer Zsolt Rumy showed class and deep knowledge of his company and industry, which is another box that should be checked off when assessing the substance of a company. The real story here today is that it's nice to see some growth companies pay off with operational wins when they've been so widely decried.

QUICK TAKES: Communications conglomerate METROMEDIA INTERNATIONAL GROUP <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: MMG)") else Response.Write("(AMEX: MMG)") end if %> rose $1 11/16 to $10 5/8 as investors looked over Q3 financials... TERADYNE <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TER)") else Response.Write("(NYSE: TER)") end if %> rose $1 3/4 to $22 3/8 as the test equipment kingpin moved up with the rest of the industry this week... Winning over analysts, who are busy counting their beans and eggs, SUNBEAM CORPORATION <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SOC)") else Response.Write("(NYSE: SOC)") end if %> added $1 7/8 to $28... Russian cellular telephone company Initial Public Offering VIMPEL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: VIP)") else Response.Write("(NYSE: VIP)") end if %> jumped $8 1/2 to $29... IBM <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IBM)") else Response.Write("(NYSE: IBM)") end if %> rose $8 1/8 to $145 after Merrill Lynch upped its price target to $190 and the company signed deals with BRITISH STEEL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BTC)") else Response.Write("(NYSE: BTC)") end if %> and NETSCAPE <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: NSCP)") else Response.Write("(NASDAQ: NSCP)") end if %>... Food producer and fire retardants maker (in other words, holding company) ERLY INDUSTRIES <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: ERLY)") else Response.Write("(NASDAQ: ERLY)") end if %> jumped $1 7/8 to $8 as the company turned in a strong second quarter earnings performance... DRECO ENERGY SERVICES <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: DREAF)") else Response.Write("(NASDAQ: DREAF)") end if %> moved up $6 11/16 to $34 3/4 after the oil services company announced solid earnings, a shareholder rights plans, and the acquisition of Vector Oil Tool... Psst -- Carlton Lutts likes THERAGENICS CORP. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: THRX)") else Response.Write("(NASDAQ: THRX)") end if %>. If you're looking for the reason why the cancer treatment company's stock was up $2 7/8 to $20 today, that's pretty much the entire reason...

GOATS

HEALTH MANAGEMENT SYSTEMS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: HMSY)") else Response.Write("(NASDAQ: HMSY)") end if %> descended $7 5/8 to $14 1/2, a new yearly low off the 52-week chart. The company guided down net income estimates for the current quarter and for 1997. Clearly, there has been some fundamental change in the industry, such as the trend toward consolidation in HMOs and hospitals, and the small and the mighty have fallen of late in healthcare information. While HBO & CO. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: HBOC)") else Response.Write("(NASDAQ: HBOC)") end if %>, the 829-pound gorilla of the market, has eased its way back from its yearly highs, other companies have been absolutely slaughtered. Investors double-tapped healthcare database company HCIA, INC. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: HCIA)") else Response.Write("(NASDAQ: HCIA)") end if %> when it announced that it would not wrap-up a key account in its third quarter, which is the same sort of problem Health Management announced today and which CERNER <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: CERN)") else Response.Write("(NASDAQ: CERN)") end if %> announced last month.

Wireless security systems maker ITI TECHNOLOGIES <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: ITII)") else Response.Write("(NASDAQ: ITII)") end if %> imploded, falling $18 3/16 to $11 15/16, under the pressure of its report this morning that ADT Security, its largest customer, is not including ITI in its "future strategic product planning." ADT has accounted for about half of ITI's sales, so it makes sense that the shares would come down by more than half, especially if one considers that the loss of a prestigious client holds the potential for doing more damage than just the loss of revenues directly attributable to that client. In addition to truly messing up budgeting at the supplier company, other clients can be swayed by the movement of an opinion leader. Such an event does pose opportunity for those who watch or intend to watch ITI. This can be the kind of event that kills a company or the glitch that rewards the decisive investor. In either case, one year from now assessing the company's reaction to this event will be very instructive for those wanting to know the quality of this company's management.

Transaction services company CHECKFREE <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: CKFR)") else Response.Write("(NASDAQ: CKFR)") end if %> dropped $2 3/8, or 12%, to $17 1/4 today following some confusion regarding the company's plans for the coming months. Today, the worries about growth were coming from Lehman Brothers, and not from anything the company itself has said. The vital announcement came yesterday long before the market closed, at which time the company said the process of integrating the acquisition of the transaction subsidiary of INTUIT <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: INTU)") else Response.Write("(NASDAQ: INTU)") end if %> is going a little slowly. Many investors are skeptical about the company's ability to compete in a market where competitors such as EDS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EDS)") else Response.Write("(NYSE: EDS)") end if %> and FIRST DATA <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: FDC)") else Response.Write("(NYSE: FDC)") end if %> dominate and in which telcos, such as the Baby Bells or MCI <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: MCIC)") else Response.Write("(NASDAQ: MCIC)") end if %>, have the networks and brand names to mount serious challenges when the data market is after the coming year. Fools everywhere are encouraged to read the conference call synopsis to get a better handle on things and make their own decisions rather than relying on the opinion of one lone person sitting in his oaken Manhattan chambers.

QUICK CUTS: Year 2000 stocks declined this morning as the Wall Street Journal panned the group, focusing on VIASOFT <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: VIAS)") else Response.Write("(NASDAQ: VIAS)") end if %>, which dropped $4 1/2 to $45 3/8. Other companies hit were ZITEL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: ZITL)") else Response.Write("(NASDAQ: ZITL)") end if %>, COMPUTER HORIZONS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: CHRZ)") else Response.Write("(NASDAQ: CHRZ)") end if %>, and DATA DIMENSIONS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: DDIM)") else Response.Write("(NASDAQ: DDIM)") end if %>... Semiconductor facility equipment maker SUBMICRON SYSTEMS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: SUBM)") else Response.Write("(NASDAQ: SUBM)") end if %> slipped $1 1/8 to $4 3/8 after investors found out the company is asking to delay its 10-Q SEC filing because it is discussing waivers of loan covenants with its primary lender... MYLEX CORP. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: MYLX)") else Response.Write("(NASDAQ: MYLX)") end if %> was blasted for a $2 7/16 loss to finish at $10 1/2 after Pacific Growth Equities said that the company's RAID controller business with HEWLETT PACKARD <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HWP)") else Response.Write("(NYSE: HWP)") end if %> is in jeopardy... Cardiovascular medical products firm MEDCATH INC. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: MCTH)") else Response.Write("(NASDAQ: MCTH)") end if %> lost $2 to $14 1/2 as investors registered disappointment over earnings, though the company doubled quarterly revenues... HEARTLAND WIRELESS COMMUNICATIONS <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: HART)") else Response.Write("(NASDAQ: HART)") end if %> was diminished by $6 1/2 to $12 5/8 as investors didn't view the company's operating numbers as positively as the company's press release did... Reporting poor operating earnings and more hassles in Los Angeles, MANHATTAN BAGEL COMPANY INC. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: BGLS)") else Response.Write("(NASDAQ: BGLS)") end if %> was toasted for a $7/8 loss this morning to finish at $8.

FOOL ON THE HILL
An Investment Opinion by MF Templar

Comdex and Hot Air

Once a year, investors gear up for the largest non-event in technology-space -- COMDEX. The largest information technology trade show in North America, COMDEX will be held in in Las Vegas from November 18-22. COMDEX is a mammoth gathering of computer- and technology-related firms at which they show their new and upcoming wares to overeager consumers, much to the delight of the media and Wall Street analysts. Consumers come by the multi-thousands, eager to try out all the hip new stuff before their neighbors can lay their mitts on them. Stocks will surge based on word of mouth from the show floor or on a particularly snazzy demo, snaring investors into the giant sucking sound of too-frequent trading.

Frankly, it is all hooey from a Fool's perspective.

Sure, a Fool absolutely loves "technology." And while I think Wall Street's myopic view of technology-space as one aggregate industry is kind of silly and leads to all sorts of bad conclusions, there is no arguing that new stuff involving sophisticated electronics is fun. Better yet, the companies behind these products often exhibit sustainable, high profit margin, above-market growth for significant periods of time -- not exactly common in the more moribund worlds of the financial, retail, cyclical or commodity industries. There is a good reason why almost everyone will tell you healthcare and technology are the "growth industries" of the '90s --almost every strong growth story seems to have something to do with one or the other.

What I'd like to dispel is the nonsensical notion that by popping into COMDEX and viewing a critical demonstration you can materially enhance your overall investment returns. Although you might catch a couple of points another less active trader might miss, the best way to enhance your investment returns remains that old saw: "Do your homework." By taking the time to learn a little bit about the actual business of a company and buying a stock based on that core business and not because of some flash-in-the-pan product that might go up in smoke in three weeks, I think you will materially enhance your returns beyond any possible momentum you could get out of a COMDEX show.

Contrary to popular opinion, very little that is new ever debuts at COMDEX. Sure, the first public display of many products is at COMDEX, but often these products have been discussed for months by students of the business and their potential market effect has already, for the most part, been psyched out. An imaginative student of the technology business can usually tell when large-scale shifts in how we connect to networks, store our data, use our computers or perform basic tasks might be ahead, simply by having a broad sense of what is possible and asking himself: "What's next?" One of the worst misconceptions out there is that one hot product can make a company completely turnaround. A lot of attention has been given to the likes of IOMEGA <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IOM)") else Response.Write("(NYSE: IOM)") end if %>, but the fact is that the company developed a sophisticated marketing plan to execute its huge wins over the past year -- the technology was just a small part in an overall strategy.

Rather than chasing the latest small-cap with a potential blockbuster product no one will remember in six months, I think investors should study the existing market leaders and join in their 10 to 20 percent annualized earnings growth out into the future. Sure, you might not double your money in six months or less, but you certainly are going to be able to double your money over a few years, quintuple it over a decade and possibly create significant wealth if you have a 20 or 30 year horizon. Forget investing because of what you might hear is going on at COMDEX and remember you are buying businesses and look for quality, and not just sex appeal, when you call your discount broker with a trade.

FOOLISH FEATURES

In today's Lunchtime News, MF Templar assesses home improvement provider AMRE, Inc. The stock is getting "remodeled" today, following the news that they've hired Bear Stearns to help them with some financing.

Our miners have hauled up another sparkling edition of Fool's Gold. Some of this weeks take will go toward gilding the edges of our Sector Snapshot on books. We'll also have shiny nuggets of research in Weekend Research Center.

CONFERENCE CALLS

11/14/96
WOOLWORTH <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: Z)") else Response.Write("(NYSE: Z)") end if %>
1-800-222-9743 -- replay (avail. 11/14 after 11AM to 4PM on 11/21)

11/14/96
WASHINGTON HOMES <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WHI)") else Response.Write("(NYSE: WHI)") end if %>
1-800-696-1588 (passcode: 152379) -- replay

11/15/96
INTERNATIONAL CABLETEL<% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: ICTL)") else Response.Write("(NASDAQ: ICTL)") end if %>
1-800-839-0814 -- replay

11/15/96
INDIANA FEDERAL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ: IFSL)") else Response.Write("(NASDAQ: IFSL)") end if %>
(call regarding their merger)
1-800-982-5963 (access code: 117157)

11/18/96
HEWLETT PACKARD <% if gsSubBrand = "aolsnapshot" then Response.Write("
(303):NYSE" & CHR(34) & ">(NYSE: HWP
(303)") else Response.Write("
(303)" & CHR(34) & " onClick=" & Chr(34) & "openWindow('http://quote.fool.com/uberdata.asp?symbols=HWP
(303)', 'quotebox', 640, 460); return false;" & CHR(34) & ">(NYSE: HWP
(303)") end if %> 446-5399 (code: 2004539) -- replay (after 8:30 p.m. EST through 8p.m. EST on 11/25)

ANOTHER FOOLISH THING

Fool Port Reports via E-mail!

It's another great idea whose time has come. Self-mowing lawns? A 24-hour Ross Perot cable channel? Pigeons trained to collect litter? Nope -- even better. We're excited to be able to offer for your convenience (okay, okay, and for our pockets!) the nightly Fool Portfolio reports, delivered via e-mail subscription. For a measly $24 per year (less than a dime a day), we'll have the FoolPort report winging its way to you as soon as it gets posted online. No more remembering to look for it, or reading it online, or wondering if you've missed one -- now it can be waiting for you each weekday evening. For more information, or to order, hop over to FoolMart.

Randy Befumo (MF Templar), a Fool
Fool On the Hill

lWta tufDffluer (Fa egMlhir), Dadaist Fool
Heroes & Goats

Brian Bauer (MF Hoops), one more Fool
Editing

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