Friday, March 06, 1998

<THE FOOLISH FOUR>

Foolish Four Report
by Robert Sheard

LEXINGTON, KY. (Mar. 6, 1998) -- Other than a few high-tech gadget makers, we don't often consider large-cap stocks as candidates for incredible moves over short periods of time. But would you believe a company like Wal-Mart <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WMT)") else Response.Write("(NYSE: WMT)") end if %> could post an 83% gain over the last 12 months?

Recently added to the Dow to replace Woolworth <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: Z)") else Response.Write("(NYSE: Z)") end if %>, Wal-Mart has made an astounding run, matched by few stocks of similar bulk. And today the nation's largest retailer upped its dividend a tad (it's still no high yielder) and picked up another 2.5% for shareholders.

I don't normally spend much time in this column on the Dow stocks miles away from the High Yield 10, but I've always maintained that there is more than one way to card a birdie on a long and tough par 5. If you're a long-ball hitter, go ahead and cut the corner of the dogleg and don't even consider the alligators in the lake you're trying to carry. If you're not blasting 300-yard drives, though, keep to the fairway and let your wedge snuggle you up close.

The same is true with investing. The High-Yield Dow approach is one way to identify good stocks from within our quality group of 30. But supplement that group of Dow high yielders with growth stocks capable of big moves like Wal-Mart has enjoyed over the past 12 months. You're going to smile just as brightly when you write a four on your scorecard as the golfer who birdies the hole another way.

If you're interested in looking at some of the Dow stocks other than those in our High-Yield rankings (or even if you just want to examine those more closely), take advantage of all the free sites available to you in addition to our message boards. On the web, start with something like Morningstar.net, where you can get a fairly comprehensive and free report on any stock in their database. And on AOL, check out the profile center for all 30 Dow stocks where you can look at First Call estimates, Hoover's profiles, a 12-month chart, Morningstar reports, and much more.

Let's hear it for Wal-Mart and go out there and fire some more shots at the pin! Have a Foolish weekend.

[Disclaimer: I've held -- happily -- a position in Wal-Mart since April 1997.]

Fool on!

[Want to be the first Fool on your block to get a copy of Robert Sheard's forthcoming book? Click here to pre-order your copy of The Unemotional Investor.]

TODAY'S NUMBERS
Stock  Change   Last 
 -------------------- 
 UK   +   3/16  46.13 
 IP   +1        48.88 
 MO   +2  1/8   44.69 
 EK   -   1/8   64.56 
 
 
                    Day   Month    Year 
         FOOL-4   +1.73%   1.30%   6.52% 
         DJIA     +1.47%   0.28%   8.36% 
         S&P 500  +1.99%   0.61%   8.79% 
         NASDAQ   +2.43%  -0.96%  11.66% 
  
     Rec'd   #  Security     In At       Now    Change 
  
  12/31/97  289 Int'l Pape    43.13     48.88    13.33% 
  12/31/97  291 Union Carb    42.94     46.13     7.42% 
  12/31/97  206 Eastman Ko    60.56     64.56     6.60% 
  12/31/97  276 Philip Mor    45.25     44.69    -1.24% 
  
  
     Rec'd   #  Security     In At     Value    Change 
  
  12/31/97  289 Int'l Pape 12463.13  14124.88  $1661.75 
  12/31/97  291 Union Carb 12494.81  13422.38   $927.56 
  12/31/97  206 Eastman Ko 12475.88  13299.88   $824.00 
  12/31/97  276 Philip Mor 12489.00  12333.75  -$155.25 
  
  
                              CASH     $77.19 
                             TOTAL  $53258.07