DJIA            8870.56   +66.76      (+0.76%) 
 S&P 500         1094.83   +12.10      (+1.12%) 
 Nasdaq          1769.95   +27.64      (+1.59%) 
 Value Line ndx   946.70    +5.48      (+0.58%) 
 30-Year Bond   104 9/32   -17/32  5.82% Yield 
 

HEROES

Digital switching, transmission, access, and network management systems maker DSC Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DIGI)") else Response.Write("(Nasdaq: DIGI)") end if %> shot up $7 13/16, or 39.68%, to $27 1/2 after announcing it has agreed to be acquired by French conglomerate and telecom equipment maker Alcatel Alsthom <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ALA)") else Response.Write("(NYSE: ALA)") end if %> in a stock-for-stock transaction valued at $4.4 billion based on yesterday's close. DSC shareholders will receive 0.815 of an Alcatel American Depositary Share for each DSC share. This represents a significant 80% premium to DSC's closing price yesterday. Alcatel, which dropped $4 3/8 to $39 1/16 today, anticipates the merger will be neutral to 1999 earnings and accretive thereafter before taking into account any revenue enhancement. The acquisition is the second of a telecommunications devices maker in as many days. Yesterday Tellabs <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TLAB)") else Response.Write("(Nasdaq: TLAB)") end if %> said it will acquire fiber-optic equipment maker Ciena Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CIEN)") else Response.Write("(Nasdaq: CIEN)") end if %>.

The DSC and Ciena acquisitions have led many investors to believe that more consolidation is on the way in the communications equipment industry, which helped drive up the shares of potential acquisition targets. Local loop equipment manufacturer Advanced Fibre Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AFCI)") else Response.Write("(Nasdaq: AFCI)") end if %> jumped $3 5/8 to $40 1/8, ADC Telecommunications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ADCT)") else Response.Write("(Nasdaq: ADCT)") end if %> gained $1 7/8 to $29 15/16, and Telco Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TELC)") else Response.Write("(Nasdaq: TELC)") end if %> charged ahead $1 21/32 to $11 7/32. Ascend Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ASND)") else Response.Write("(Nasdaq: ASND)") end if %> ascended $3 1/16 to $45, Comverse Technology <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CMVT)") else Response.Write("(Nasdaq: CMVT)") end if %> rose $1 5/8 to $51 1/2, Reltec Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RLT)") else Response.Write("(NYSE: RLT)") end if %> powered up $5 1/4 to $41 1/8, and Uniphase Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: UNPH)") else Response.Write("(Nasdaq: UNPH)") end if %> gained $1 3/8 to $55 3/8.

Several retail stocks advanced today after reporting strong increases in sales in May. Casual apparel company Gap Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GPS)") else Response.Write("(NYSE: GPS)") end if %> jumped $2 1/8 to $56 1/4 after reporting a 24% rise in same-store sales. Circuit City Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CC)") else Response.Write("(NYSE: CC)") end if %> connected for $3 3/16 to $45 3/16 after reporting a 12% increase in comparable sales at its consumer electronics stores and a 1% drop at its CarMax <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KMX)") else Response.Write("(NYSE: KMX)") end if %> used car superstores. Circuit City announced that it expects to beat analysts' expectations for the first quarter thanks to strong sales of computers, big screen TVs, and large home appliances. Consumer electronics retailer Best Buy <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BBY)") else Response.Write("(NYSE: BBY)") end if %> also picked up $15/16 to $32 7/8 after reporting a 15% gain in first quarter same-store sales and saying it expects Q1 earnings to be at the high end of analysts' estimates.

QUICK TAKES: Intel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INTC)") else Response.Write("(Nasdaq: INTC)") end if %> regained $2 1/4 to $68 3/16 after the world's largest chip maker said it has no plans to issue an earnings warning as some analysts and investors had feared. Other semiconductor manufacturers and PC makers followed the move up. Texas Instruments <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TXN)") else Response.Write("(NYSE: TXN)") end if %> added $2 7/8 to $50 7/8; IBM <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IBM)") else Response.Write("(NYSE: IBM)") end if %> gained $2 3/16 to $116 1/16; and Gateway <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GTW)") else Response.Write("(NYSE: GTW)") end if %> was up $1 9/16 to $47 1/8... Dell Computer <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DELL)") else Response.Write("(Nasdaq: DELL)") end if %> rose $4 1/4 to $84 1/2 as Lehman Brothers told investors that "recent checks with Dell indicate that revenue growth remains strong across all geographies and all product lines"... Internet and computer software company Netscape Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NSCP)") else Response.Write("(Nasdaq: NSCP)") end if %> jumped $2 1/16 to $24 3/8 after announcing that Ford Motor Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: F)") else Response.Write("(NYSE: F)") end if %> has licensed Netscape's directory software for its computer network.

Oil and oil-field service companies struck black gold today on news that officials from Saudi Arabia, Venezuela, and Mexico are meeting to discuss cutting oil production. Exxon <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: XON)") else Response.Write("(NYSE: XON)") end if %> gained $1 5/16 to $70 5/16, Texaco <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TX)") else Response.Write("(NYSE: TX)") end if %> advanced $1 13/16 to $58 1/8, Mobil <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MOB)") else Response.Write("(NYSE: MOB)") end if %> added $1 1/8 to $76 1/2, Atlantic Richfield <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ARC)") else Response.Write("(NYSE: ARC)") end if %> rose $1 1/2 to $79 1/4, Global Marine <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GLM)") else Response.Write("(NYSE: GLM)") end if %> moved up $1 to $22 1/16, Dresser Industries <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DI)") else Response.Write("(NYSE: DI)") end if %> was up $2 to $44 7/8, and Schlumberger <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SLB)") else Response.Write("(NYSE: SLB)") end if %> tacked on $2 13/16 to $76 7/8... Computer networking firm Bay Networks <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BAY)") else Response.Write("(NYSE: BAY)") end if %> added $3 to $30 15/16 after announcing that International Data Corp. data shows that Bay leads in shipments of LAN (local area network) element management software with a 70.4% market share last year.

Lucent Technologies <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: LU)") else Response.Write("(NYSE: LU)") end if %> rang up $2 5/8 to $72 after the telecommunications equipment giant introduced a new optical fiber that handles 50% more usable wavelengths than conventional fiber... Database software company Oracle <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ORCL)") else Response.Write("(Nasdaq: ORCL)") end if %> rose $1 1/4 to $24 13/16 on expectations that the company will report good Q4 earnings June 17... Business management software company PeopleSoft <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PSFT)") else Response.Write("(Nasdaq: PSFT)") end if %> picked up $4 3/16 to $46 3/16 after announcing it will acquire privately held Interpid Systems Inc. for $57.7 million in stock... Application specific integrated circuit (ASIC) manufacturer LSI Logic <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: LSI)") else Response.Write("(NYSE: LSI)") end if %> jumped $2 15/16 to $23 15/16 after Merrill Lynch raised its rating on the company to long- and short-term "accumulate" from long- and short-term "neutral." Merrill analyst Thomas Kurlak said LSI is the largest chip supplier to the communications industry, a hot market now.

American Home Products <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AHP)") else Response.Write("(NYSE: AHP)") end if %> added $1 7/8 to $50 1/2 after Merrill Lynch upgraded the pharmaceutical company to near-term "accumulate" from "neutral"... Medical imaging systems maker Adac Laboratories <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ADAC)") else Response.Write("(Nasdaq: ADAC)") end if %> charged up $3 7/16 to $23 after saying that it is likely that more doctors will be willing to perform Positron Emission Tomography (PET) scans in diagnosing lung cancer now that the Health Care Financing Administration has released instructions for insurance reimbursement... Computer networking company 3Com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: COMS)") else Response.Write("(Nasdaq: COMS)") end if %> gained another $1 9/16 to $26 9/16 in the wake of announcing plans to hire a new executive to manage day-to-day operations and relieve CEO Eric Benhamou of some responsibilities.

Dollar Tree Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DLTR)") else Response.Write("(Nasdaq: DLTR)") end if %> rose $1 3/8 to $51 7/8 after announcing a 3-for-2 stock split payable June 29...Call automation systems maker Intervoice <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INTV)") else Response.Write("(Nasdaq: INTV)") end if %> advanced $1 1/2 to $15 3/8 after saying it expects Q1 EPS to increase to between $0.20 and $0.22 a share from $0.02 a year ago... Internet software developer Open Market <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: OMKT)") else Response.Write("(Nasdaq: OMKT)") end if %> gained $1 3/4 to $17 1/4 after announcing that Intel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INTC)") else Response.Write("(Nasdaq: INTC)") end if %> has purchased 333,000 of its shares as part of a deal for Open Market to develop software that will run on Intel's latest computer chips... E*Trade Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: EGRP)") else Response.Write("(Nasdaq: EGRP)") end if %> gained $1 7/8 to $22 after announcing that it now offers Scudder Kemper Investments' mutual funds on its online trading site.

Broadcom Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: BRCM)") else Response.Write("(Nasdaq: BRCM)") end if %> moved up $2 7/8 to $54 7/8 after Merrill Lynch gave the semiconductor maker a near-term "buy" rating in new coverage, with a 12-month price target of $75... Oil company Helmerich & Payne <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HP)") else Response.Write("(NYSE: HP)") end if %> tacked on $1 7/16 to $25 1/16 after announcing plans to buy back up to 2 million shares, or roughly 4% of its outstanding shares... Footwear maker Stride Rite <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SRR)") else Response.Write("(NYSE: SRR)") end if %> marched ahead $1 3/16 to $14 7/8 after BT Alex. Brown raised its rating on the company to "strong buy" from "buy"... Cable Michigan <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CABL)") else Response.Write("(Nasdaq: CABL)") end if %> picked up $3 3/16 to $38 7/16 after the cable TV operator announced it has agreed to be acquired by Avalon Cable for $435 million, or $40.50 a share in cash. Avalon Cable also plans to acquire Cable Michigan's 62% owned subsidiary Mercom Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MEEO)") else Response.Write("(Nasdaq: MEEO)") end if %> for $11 a share.

GOATS

Number four U.S. air carrier Northwest Airlines Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NWAC)") else Response.Write("(Nasdaq: NWAC)") end if %> fell $2 13/16 to $39 13/16 after saying that its fiscal Q2 earnings could be "significantly below" the $1.26 per share earned last year. The Street had been expecting earnings of $1.70 per share in the quarter. The shortfall is attributed to the Asian financial crisis and aircraft damaged by severe weather. Sales might also have been hurt after some employees reportedly delayed flights by calling for an unusually high number of mechanical repairs while negotiations over a new labor contract were taking place. Last week, Northwest's pilots voted in favor of giving their negotiators the power to call for a strike if the current talks hit a roadblock. That possibility seems a bit more likely this week, after the pilots rejected the company's latest offer to tie pilot salaries to those at UAL Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: UAL)") else Response.Write("(NYSE: UAL)") end if %>, AMR Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AMR)") else Response.Write("(NYSE: AMR)") end if %>, and Delta Air Lines <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DAL)") else Response.Write("(NYSE: DAL)") end if %>, calling the proposal a "PR stunt."

Automotive systems and powertrains supplier Borg-Warner Automotive <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BWA)") else Response.Write("(NYSE: BWA)") end if %> dropped $9 15/16 to $47 1/2 after saying that its Q2 earnings will come in 20% to 25% below the $1.23 per share earned a year ago. The IBES mean estimate called for earnings of $1.32 per share. The company blamed the shortfall on the Asian financial crisis and weak truck production by client Ford Motor Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: F)") else Response.Write("(NYSE: F)") end if %>. The automaker is reportedly producing less of its F-150 pickups due to a shortage of V-8 engines. The company said Ford is also making less F-150s with four-wheel drive transmissions. Combined, the two trends are expected to reduce Borg-Warner's shipments to Ford in the quarter by 45% compared to a year ago. Both PaineWebber and McDonald & Co. cut their ratings on Borg-Warner today.

QUICK CUTS: Motion picture projection equipment supplier Ballantyne of Omaha <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BTN)") else Response.Write("(NYSE: BTN)") end if %> fell $4 7/8 to $12 1/2 after saying a slowdown in orders from Asia, Mexico, and some U.S.-based customers will result in Q2 EPS of $0.14 to $0.15. The First Call mean estimate called for EPS of $0.25 in the quarter... Biotechnology firm and impotency pill developer Zonagen Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ZONA)") else Response.Write("(Nasdaq: ZONA)") end if %> lost $4 5/16 to $26 15/16 after drug giant Pharmacia & Upjohn <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PNU)") else Response.Write("(NYSE: PNU)") end if %> said it is developing an impotence drug of its own to compete with Pfizer's <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PFE)") else Response.Write("(NYSE: PFE)") end if %> Viagra. Another player in the impotency market, Vivus <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: VVUS)") else Response.Write("(Nasdaq: VVUS)") end if %>, fell $3/4 to $6 5/16 on the news.

Electronics and computer equipment retailer Tandy Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TAN)") else Response.Write("(NYSE: TAN)") end if %> dropped $1 5/16 to $43 15/16 after reporting that same-store sales at its Computer City stores fell 2% in May compared to a year ago. The firm also noted that same-store sales at its Radio Shack unit increased 4% year-over-year, which was "slightly below plan"... Secondary education centers operator ITT Educational Services <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ESI)") else Response.Write("(NYSE: ESI)") end if %> slid $7/8 to $24 3/8 after Starwood Hotels & Resorts Worldwide <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HOT)") else Response.Write("(NYSE: HOT)") end if %> said it would reduce its stake in the company to 41% by selling 11.35 million ITT Educational shares at a price of $24.25 per share... Cessna aircraft and Bell helicopter manufacturer Textron Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TXT)") else Response.Write("(NYSE: TXT)") end if %> slid $1 to $70 1/4 after saying it is considering a possible sale or spin-off of its Avco Financial Services consumer finance unit, which accounted for 18% of the firm's total revenues in fiscal 1997.

Discount apparel retailer Ross Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ROST)") else Response.Write("(Nasdaq: ROST)") end if %> slumped $1 5/8 to $41 1/4 after reporting that same-store sales in May declined 1% from their levels a year ago... Upholstery fabric and mattress ticking maker Culp Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CFI)") else Response.Write("(NYSE: CFI)") end if %> was shredded $3 3/4 to $13 9/16 after reporting fiscal Q4 EPS of $0.31, missing the Street estimate of $0.40. The company said demand for its printed flock upholstery fabrics has slowed due to the Asian financial crisis... Horace Mann Educators Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HMN)") else Response.Write("(NYSE: HMN)") end if %>, which sells property and casualty insurance primarily to teachers, fell $1 1/16 to $31 7/8 after saying that recent severe weather in Minnesota, the Midwest, and the Northeast will reduce the firm's Q2 earnings. So far, Q2 catastrophe losses amount to $15 million compared to a total of $2.8 during the same period a year ago.

Life USA Holdings <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: LUSA)") else Response.Write("(Nasdaq: LUSA)") end if %> slid $13/16 to $15 1/8 after Stephens Inc. downgraded the life insurance company to "neutral" from "market outperformer"... Steel container maker BWAY Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BY)") else Response.Write("(NYSE: BY)") end if %> moved down $2 5/8 to $22 after saying it will take a $10 million to $12 million restructuring charge in fiscal Q3 related to the planned closings of six facilities and the write-off of redundant equipment... Kay-Bee Toys parent Consolidated Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CNS)") else Response.Write("(NYSE: CNS)") end if %> fell $1 to $34 3/4 after reporting a 2.8% decline in May same-store sales compared to the same month a year ago... Insurer Vesta Insurance Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: VTA)") else Response.Write("(NYSE: VTA)") end if %> dropped $2 1/2 to $26 after shareholders filed a class action lawsuit against the company alleging the filing of false financial statements and earnings reports.

FOOL ON THE HILL
An Investment Opinion
by Alex Schay

Weighing Machine

Mute witness to the market's relentless information-processing function was yesterday's action in shares of America Online <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AOL)") else Response.Write("(NYSE: AOL)") end if %>. The company closed up $1 5/8 to $79 on the day that the Wall Street Journal ran another one of its accounting expos�s on the firm in a "Heard on the Street" column. While some commentators have opined that the market reaction is testimony to the article's less-than-earth-shattering revelations, the time frame surrounding the whole affair is interesting.

On Monday, America Online was down 5.48% on rumors that the Wall Street Journal was going to run a damaging story about its accounting practices, probably due to the fact that reporters were calling around soliciting various analysts for comments. Word spread so rapidly -- fast enough to actually reach the "news" department at the Motley Fool -- that traders began to unload shares. By the time the Wednesday edition of the Journal hit newsstands, AOL had endured a more than 7% decline. In the interim, of course, "the market" has had time to digest the information contained in the column and has since bid the company's stock back up to a region closer to last Friday's close. Wednesday's response from erratic "Mr. Market" was, "Is that all?"

It is often said that in the long run the market is an efficient vehicle for recognizing the value of a company, but in the short term it falls considerably shy of this objective. This value orientation stems from the type of investment sensibility reflected in the following comments made by Warren Buffet in the 1987 Berkshire Hathaway Annual Report:

"The market may ignore business success for a while, but eventually will confirm it. As Ben [Graham] said: "In the short run, the market is a voting machine but in the long run it is a weighing machine." The speed at which a business's success is recognized, furthermore, is not that important as long as the company's intrinsic value is increasing at a satisfactory rate. In fact, delayed recognition can be an advantage: It may give us the chance to buy more of a good thing at a bargain price."

This brilliant insight is a fundamental tenet of value investing. However, it is important to realize that there are two sides to the investment coin. On the "value" side of the coin, the market is inefficient in the short run -- it tosses aside value at the expense of the most current view and the most current information. On the flip side, the information processing side, the market is extremely efficient in the short run -- it makes the necessary modification to a company's stock price to reflect the most up-to-the-minute view on the firm. In the strictest sense, at Monday's close, America Online correctly carried a lower price than at the beginning of the day in order to reflect the risk associated with widespread dissemination of possible accounting shenanigans.

A company with looming accounting issues that call into question the quality of the firm's reported earnings is simply worth less than the same company without those impending concerns. Of course, the patient, long-term investor will look at the probably minimal disparity between this week's closing price and last week's and wonder whether or not the whole affair was just a dream -- or more importantly, just white noise to be filtered out of any investment considerations. Short-term noise is exactly the reason why Buffet has been quoted as saying that he would not care if the market closed for ten years -- after all, it closes every Saturday and Sunday and it has not bothered him yet.

Sidestepping the philosophical third rail issue of "truth" -- although it probably has something to do with value (yuk, yuk) -- as well as related "nature of reality" considerations, the America Online example is really an imperfect one for many reasons. But it's good enough of an example to illustrate the idea that money can be made if investors focus on a value approach and remain confident in their assessment of a company's intrinsic value.

With the idea that it is not this columnist's responsibility to offer up a mini-treatise on investment philosophy (although if a full-time position is open somewhere, by all means let me know), it's time to actually offer some "valuable" information. The Journal's America Online story in part raises important questions about the nature of intercorporate investments. Although that topic warrants treatment in an entire book, perhaps a future column is more realistic. In the meantime, here is a copy of a chart that used to be taped to this columnist's desk.

The Five Major Types of Intercorporate Investments for Accounting and Financial Reporting Purposes

Trading Securities -- Investments in debt and equity securities acquired principally for the purpose of selling them in the near term and thereby generating profits on short run fluctuations in market prices. Classified as current assets for balance sheet purposes.

Available-for-sale Securities -- Investments in debt and equity securities that do not qualify as one of the other types of investments in these securities. Classified as either current or long-term assets depending on the length of time that management intends to hold these securities.

Held-to-maturity Securities -- Investments in debt securities acquired with the positive intent an ability to hold them to maturity. Classified as long-term assets unless they mature in the coming year, in which case they are classified as current assets.

Influential but Noncontrolling Investments -- Investments in equity securities in which the "investor" corporation generally owns at least 20% but not more than 50% of the "investee" corporation's common stock. Classified as long-term assets for balance sheet purposes.

Controlling Investments -- Investments in equity securities in which the "parent" company owns more than 50% of the common stock of the "subsidiary." Consolidated financial statements are prepared for the parent company and its subsidiaries.

[It is important to note that an Unrealized Gain on Trading Securities is a revenue account, while the Unrealized Gain on Available-for-Sale Securities is an equity account.]

CONFERENCE CALLS

Please see the Motley Fool's Conference Calls page for call information and links to synopses.

WE DELIVER - Get The Evening News delivered
to your e-mailbox every evening!

ANOTHER FOOLISH THING

See something moving a stock that we didn't cover?
E-mail the Fool News Team
and we will start working on the story.
Unfortunately, we cannot answer every e-mail
or respond to individual questions.