After seeing the LindyBill post "I met my goal" I was curious as to what the mkt caps of CSCO, INTC, MSFT were 5 yrs ago when he was buying these young primates. Also, what was the mkt cap of other large "main street" companies and how have they grown since then? These questions caused me to do a little mkt cap research, which is listed below.
_______MktCap__6-30-95__Gain
CSCO___459 B____19 B____2300%
INTC____426 B____23 B____1700%
MSFT___361 B____42 B_____700%
GE______514 B___186 B_____170%
WMT___238 B___112 B_____100%
XOM___282 B____98 B_____190%
First, let me say that I realize this is not a great comparison. GE, WMT, XOM(Exxon) are not tech companies, but they are three of the largest from the Dow 30, and have had their own quasi hyper-growth periods in the past (Remember WMT in the 80's?). So anyway, my point is that during the five year bull mkt from '95 to present these companies on main street in the old economy grew from 100% to 190%. Not bad, but nothing compared to the silverbacks listed above.
In '95 CSCO, INTC, MSFT were mid to large cap companies that have since become giant-caps. Given their size at present how much growth can a new Tornado deliver? It seems that this type company is best used as core holdings for stability and safety. However, for growth rates similar to those from '95 to date we must locate the next Gorilla before it becomes a silverback. Also, a great lesson that I've learned in doing this is that we don't have to buy a company when it is a micro-cap or small-cap to make awesome returns. Below is a list of the G&K Portfolio ranked by mkt cap.
G&K Portfolio (Ranked by Mkt Cap)
CSCO...459 B
INTC...426 B
MSFT...361 B
EMC....184 B
SUNW...172 B
JDSU....92 B
QCOM....48 B
SEBL....34 B
NTAP....26 B
GMST....12 B
I found two things interesting:
(1) We can buy QCOM today at near the same mkt cap as MSFT in '95
(2) LindyBill's 30% position in JDSU/SDLI. Yet, no more than 9.5% in any of the silverbacks. ("I've learned to just watch him,... and marvel." uf)
Just food for thought.
Regards,
willkm3 |
