The Motley Fool: The Boring Portfolio

Boring Portfolio Report
Monday, September 29, 1997
by Greg Markus (TMF [email protected])

ANN ARBOR, Mich. (Sept.29, 1997) -- The S&P 500 and Nasdaq posted healthy gains of 0.86% and 0.76%, respectively, on this next-to-last day of the third quarter, but the Boring Portfolio backpedaled 0.71%.

Most of the those losses resulted from a $2 1/8 drop in shares of OXFORD HEALTH PLANS <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: OXHP)") else Response.Write("(Nasdaq: OXHP)") end if %>. Along with a number of other HMO stocks, Oxford fell after rival AETNA <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AET)") else Response.Write("(NYSE: AET)") end if %> confirmed rumors that that it would miss analysts' earnings expectations by as much as 27% because of problems with rising medical costs and continuing challenges associated with merging U.S. Healthcare's operations into Aetna's. Aetna reportedly stopped paying claims as it attempted to consolidate its computerized information systems with U. S. Healthcare's.

As noted here before, and as indicated in Oxford's most recent post-quarter conference call, Oxford's medical costs are falling, not rising. And although Oxford has had its own share of highly publicized computer problems, the company insists they are resolved.

On the upside, TIDEWATER <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TDW)") else Response.Write("(NYSE: TDW)") end if %> gained $1/4 as part of a strong group of oil drilling and services stocks.

Also, CISCO SYSTEMS <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CSCO)") else Response.Write("(Nasdaq: CSCO)") end if %> rose $7/16 on news of yet another new Cisco product and upgrade in its line of dial access products (the Cisco 3600 series). After the closing bell, rival ASCEND COMMUNICATIONS announced it would fall well short of analysts' expectations for the September quarter. How this news will affect Cisco in the near-term is something I won't pretend to have any insight into. We'll find out soon enough, I suppose.

Finally tonight, following The Motley Fool's recent venture across the pond, BORDERS GROUP <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BGP)") else Response.Write("(NYSE: BGP)") end if %> announced it has signed a definitive agreement to acquire Britain's third-largest independent bookseller, Books, etc. According to published reports, Borders will pay between $49 million and $65 million for Books, etc., which has 22 outlets, most of them in London.

Borders said it doesn't expect the transaction to have a "material impact" on earnings per share in either fiscal 1997 (ends January 1998) or fiscal 1998. Following completion of the transaction, Books, etc. will continue to be led by Richard Joseph, its current Chairman and CEO, and the existing management team.

Borders also confirmed rumors that it will open its first Pacific Rim bookstore, in Singapore. The Singapore superstore, slated to open Nov. 1, will offer more than 200,000 books and music titles and house the de rigeur cafe. Borders stock slipped $9/16.

In light of the coincidence between the Fool's and Borders's international strategies, ought we infer that the recently launched "Beat the Footsie" will soon be followed by a "High-Jump the Hang Seng"?

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TODAY'S NUMBERS

Stock  Change    Bid
ATLS  +  1/8   27.88
BGP   -  3/16  28.81
CSL   -  3/16  44.69
CSCO  +  3/4   73.56
GNT   +  3/4   47.31
ORCL  -  9/16  37.63
OXHP  +3 1/16  77.94
PMSI  +  1/2   14.75
TDW   -  1/8   58.88

                   Day   Month    Year  History
        BORING   +0.73%   6.59%  29.62%  49.16%
        S&P:     +0.78%   5.09%  27.60%  52.06%
        NASDAQ:  +0.20%   5.98%  30.30%  61.60%

    Rec'd   #  Security     In At       Now    Change
  2/28/96  400 Borders Gr    11.26     28.81   155.97%
  8/13/96  200 Carlisle C    26.32     44.69    69.75%
  5/24/96  100 Oxford Hea    48.02     77.94    62.29%
   2/2/96  200 Green Tree    30.39     47.31    55.70%
   3/8/96  400 Prime Medi    10.07     14.75    46.49%
  6/26/96  100 Cisco Syst    53.90     73.56    36.48%
 12/23/96  100 Tidewater     46.52     58.88    26.55%
   3/5/97  150 Atlas Air     23.06     27.88    20.89%
 11/21/96  150 Oracle Cor    32.43     37.63    16.01%

    Rec'd   #  Security     In At     Value    Change
  2/28/96  400 Borders Gr  4502.49  11525.00  $7022.51
  8/13/96  200 Carlisle C  5264.99   8937.50  $3672.51
   2/2/96  200 Green Tree  6077.49   9462.50  $3385.01
  5/24/96  100 Oxford Hea  4802.49   7793.75  $2991.26
  6/26/96  100 Cisco Syst  5389.99   7356.25  $1966.26
   3/8/96  400 Prime Medi  4027.49   5900.00  $1872.51
 12/23/96  100 Tidewater   4652.49   5887.50  $1235.01
 11/21/96  150 Oracle Cor  4864.99   5643.75   $778.76
   3/5/97  150 Atlas Air   3458.74   4181.25   $722.51

                             CASH   $7890.00
                            TOTAL  $74577.50