Before I begin, I would like to remind everyone that I follow Brinker's philosophy that index funds are not only great performers, they are tax-efficient and cost-efficient as well. I believe I have thanked Bob for showing me the benefits of indexing. (See post #3740 dated March 3, 1998). My ONLY contention is, and remains, that Brinker is in denial when it comes to thinking that he can outperform or time the market.
For purposes of showing that Brinker's individual stock picks are useless, and thus, his UTEK recommendation was worthless, I'll present quotes of previous stock recommendations for the next few weeks. Some good, some bad, but in the end I think you'll agree his track record for recommending individual issues is far from above average.
I'll begin with Komag. Brinker made mention of Komag on Nightly Business Report for the first time on September 22, 1995. Here is the text:
KANGAS: How about individual issues?
BRINKER: Well, there are ideas out there. There is a company on the Nasdaq, Komag, K-M-A-G. Now here's a stock that serves the high performance disk drive market, stock's trading around 69-1/2, growing 35% compound annual looking forward. And this is an exciting stock. I think next year that Komag will trade above $100 a share.
Komag reached a split-adjusted high of $37 7/16 on September 13, 1995. Brinker issued his buy recommendation on public television just over a week later (Sept. 22) at a split -adjusted $34 3/4. In just two short months, Komag reached a low of 21 3/8 on November 21, 1995. That's almost a 40% drop in just two months.
Well, Brinker was back on Nightly Business Report on May 31, 1996. It was 9 months later, the S & P 500 was up 15% since Brinker's last visit (9/22/95), not including dividends, and Komag was an 1/8 of a point lower than when Brinker recommended it.
Here's the text:
KANGAS: Last time you were with us you gave us a few ideas, individual stocks. Microsoft you said hold at 90, it's now about 118. You liked Komag at 35, now it's the equivalent of 70 after a 2-for-1 split. What do we do with those two fellows?
BRINKER: Komag is a hold for sure and I would hold Microsoft.
Well, at the close of business on May 31, 1996, Komag closed at $34 5/8 and once again Komag tanked, even after Brinker's assurance that "Komag is a hold for sure". This time in just six weeks Komag hit a low of $17 5/8 on July 16, 1996. That is just shy of a 50% hit in just over a month and a half. And more importantly, it's almost a 50% hair-cut since Brinker's first mention on NBR on Sept. 22, 1995.
Komag closed today at $14. If you would have bought Komag when Brinker first recommended it on NBR on 9/22/95, you would have an unrealized loss of over 59%, and NO, Brinker never issued a sell. He just kept quiet. In this same time period, the S & P 500 has risen over 81%, not including dividends of course.
No wonder why Brinker doesn't tell his listeners about this stock pick. I'm sure he'd like to forget about this one. I mean, if everyone knew about the outcome of this pick, they just might think twice before following his next stock pick.
Rillinois |
