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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: mister topes who wrote (3856)	3/7/1998 1:25:00 PM
From: Trebor	Read Replies (1) \| Respond to of 42834

>You left out Uniphase recommended on NBR at 45 and sold on NBR at 80.> Good point. I'm up over 100% on Uniphase, a company I would never have heard about or bought without BB's recommendation. His only mistake was to sell too early. UNPH continues to perform well.

To: mister topes who wrote (3856)	3/13/1998 9:07:00 PM
From: Rillinois	Respond to of 42834

Brinker and Stanford Telecom 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. My sole contention is that Brinker is in denial when it comes to thinking that he can outperform the market with individual stock picks. Brinker recommended Stanford Telecom for the first time on May 31, 1996 on the Nightly Business Report. (As everyone knows, this is also the same day he first recommended Ultratech Stepper at $25.) Here is the text to prove it. KANGAS: Any individual stocks, new ones that you would buy at these levels? BRINKER: There are great small cap ideas and in the technology area, particularly, Ultratek Stepper, which manufactures photolithography systems. KANGAS: Symbol? BRINKER: UTEK on the Nasdaq 25. KANGAS: Okay. BRINKER: And this company is making systems for the manufacturer of semiconductors and thin film that's also for disk drives. And outstanding outlook, rapid growth, and I think it's very attractive. KANGAS: Okay. So that's your one basic selection away from your mutual funds? BRINKER: In that area. In the telecom area and equipment area I like Stanford Telecom Nasdaq STII, small cap once again about 30 to 50 million market cap. They're into the broad band wireless cable and the cable modems and the wireless local loop, and personal satellite communications. Four very rapidly growing areas. Stanford Telecom closed at a split-adjusted price of $27 5/8 on May 31, 1996. This is a stock that peaked on May 13, 1996, at $32 7/8, but Brinker liked it enough to recommend it at $27 5/8. Again, Brinker virtually picked the top. By the way, on May 31, 1996, the Russell 2000 closed at 361.85 and the S & P 500 closed at 669.12. Within 7 months Stanford Telecom hit a low of $11 1/4 on December 11, 1996. Not only did it become a "teenager" like Ultratech Stepper, it almost became a hat size. Stanford Telecom had fallen nearly 60% since Brinkers first recommendation. In the same time period the Russell 2000 had fallen a tiny 1% and the S & P 500 had risen over 10%, not including dividends, of course. The next time Brinker appeared on NBR, it was January 24, 1997. Here is what he said at that appearance. KANGAS: Quickly now. You also gave this as the only clinker you had in that entire interview, Stanford Telecom (STII). It was at 55. It's now all the way down to 32. Out of it? BRINKER: I would say no. I would say the stock is attractive here. It's on sale here, a very technology rich company, broadband wireless, personal satellite communications, cable modems. I think the stock's a buy. Stanford Telecom closed at $15 15/16 on January 24, 1997. Brinkers next visit was October 17, 1997. Here is the text. Pay special attention to Brinkers positive spin on STII. KANGAS: And Stanford Telecom (STII) had a good move. You recommended... BRINKER: Yes. KANGAS: ... it at 15; and had a 2-for-1 split. Now, on that basis, it's 23. Take it away? BRINKER: Well, we're up close to 50 percent since January in that one. I would hold the stock here, but if it gets back below 20, I'd be willing to add to it. Stanford Telecom closed at $23 1/4 on October 17, 1997. Now amazingly, Brinker focuses in on the fact that STII is up 45% since his last visit, but makes no mention of the more important fact that he is still down over 15% since his original recommendation. This is SPIN at its best. Beyond that Brinker said he'd be willing to add to the position if got back below $20, well it did. As of the close of business on March 13, 1998, Stanford Telecom closed at $17. Brinker is down nearly 40% on this recommendation since May 31, 1996. In the same time period the Russell 2000 has risen almost 30% and the S & P 500 has risen just shy of 60%, not including dividends, of course. Rillinois

To: mister topes who wrote (3856)	3/13/1998 11:06:00 PM
From: Rillinois	Read Replies (3) \| Respond to of 42834

Brinker and Uniphase For the record, 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. My sole contention is that Brinker is in denial when it comes to thinking that he can outperform the market with individual stock picks. Brinker recommended Uniphase for the first time on January 24, 1997 on the Nightly Business Report. Here is the text. KANGAS: New suggestions? BRINKER: Well, there's a proprietary technology company, Uniphase that has a technology that speeds the transmission of date with the use of fiberoptics. And Uniphase, I think, is going to make new highs this year. This stock was 60 a few weeks ago. It's trading at 45 now. KANGAS: Symbol? BRINKER: UNPH on the NASDAQ. Uniphase closed at a spit-adjusted price of $22 3/4 on January 24, 1997. The S & P 500 closed at 770.52. One month later Unipase dropped to $15 5/8 on February 28. However, Uniphase, unlike Komag and Stanford Telecom, did rebound strongly after its' initial plunge. By the time Brinker made his next appearance on NBR on October 17, 1997, Uniphase had nearly doubled. Here is the text. KANGAS: OK. Are you taking some money off the table, now? BRINKER: Well, one of the stocks I recommended ... KANGAS: Uniphase (UNPH)... BRINKER: Uniphase ... KANGAS: ... a great winner, at 45, on your last visit with us - which was on January 24th. The Dow was at 6696. Uniphase was at 45. It's now over 80. BRINKER: Yes. KANGAS: You're... BRINKER: ... trading around 80. Yes. I would book that profit. I would sell that stock; it's about 33 times next year's earnings. It has been a huge home run winner for us. I would take the profit. Uniphase closed at a split-adjusted $39 3/4 on October 17, 1997. Uniphase returned 74% before taxes for investors who bought based on Brinkers' original recommendation. Since this was a short-term capital gain, the after-tax return on this investment will vary between investors. Those in the 28% income-tax bracket netted 53% in ten months. Those in the highest bracket (39.6%) netted 45% in ten months. Obviously, those who bought in a retirement account kept all of the proceeds. In the same time period the S & P 500 rose over 22%, not including dividends. However, if you had stuck to Brinker's 4% rule (max. exposure in any one stock should be limited to 4% of total equities), your total portfolio gain due to UNPH would have been less than 3% in a tax-deferred account and approximately 2% in a taxable account. (Assumes 4% in UNPH and 96% in S & P 500). In my opinion, much is written about how your losses would have been negligible if you stuck to Brinker's 4% rule (ie. Ultratech Stepper, Komag, Stanford Telecom.), but not enough is written on how little you would have made if you had a winning stock and stuck to Brinker's 4% rule. Finally, as of the close on March 13, 1998, Uniphase closed at $41. It might be to early to tell, but did Brinker sell UNPH too early? More importantly, not only did Brinker create a taxable event for some investors, but on the same appearance Brinker recommended sale of UNPH, he recommended purchase of Ultratech Stepper at under $30 and Stanford Telecom at under $20. Here is the text to prove it. KANGAS: OK. Are you taking some money off the table, now? BRINKER: Well, one of the stocks I recommended ... KANGAS: Uniphase (UNPH)... BRINKER: Uniphase ... KANGAS: ... a great winner, at 45, on your last visit with us - which was on January 24th. The Dow was at 6696. Uniphase was at 45. It's now over 80. BRINKER: Yes. KANGAS: You're... BRINKER: ... trading around 80. Yes. I would book that profit. I would sell that stock; it's about 33 times next year's earnings. It has been a huge home run winner for us. I would take the profit. KANGAS: Ultratech Stepper (UTEK) recommended at 28. It's now about 30. BRINKER: Yes. Ultratech Stepper is, I think, a special situation in capital equipment. They have a new process, Paul, "P-Gild" which is an advanced laser thermal processing tool for semiconductor manufacture in the smaller geometries. This is a big potential market. Could be a $2 billion market within a few years. They have other new products. They have a new mask-making division, Ultrabeam. They'll be coming in in '98. And they have a new pole-trimming tool, which is used for disk drive manufacturers. Saves a lot of money for the manufacturers in that area. I think Ultratech Stepper would be my single best purchase at this point. I would recommend buying that stock right in here tonight, in the 29-and-a-fraction area. KANGAS: OK. That's U-T-E-K. BRINKER: Yes. UTEK. KANGAS: NASDAQ. BRINKER: NASDAQ. KANGAS: And Stanford Telecom (STII) had a good move. You recommended... BRINKER: Yes. KANGAS: ... it at 15; and had a 2-for-1 split. Now, on that basis, it's 23. Take it away? BRINKER: Well, we're up close to 50 percent since January in that one. I would hold the stock here, but if it gets back below 20, I'd be willing to add to it. So much for the "huge home run winner". Apparently the opposing team tied up the game in the ninth and they have the winning run on third. UTEK is down over 25% in just 5 months and STII, (initially recommended by Brinker at $27 5/8 on May 31, 1996) which closed below $20 on December 5, 1997, closed today at $17, or down 14%. Now if we use the 4% rule example from before (4% UNPH and 96% S & P 500); UNPH contributed 2% (45%-53% of 4%) to the total portfolio in a taxable account, UTEK would have deducted 1% of the total portfolio (25% of 4%), and STII would have deducted 1/2% of the total portfolio (14% of 4%). So, these three stock picks recommended by Brinker would have netted a portfolio 1/2%. In other words, the net return of these stock picks is approximately 10%. In contrast, the S & P 500 has risen over 38%, not including dividends, since the UNPH recommendation on January 24, 1997. All in all UNPH was a winning trade, but Brinker still hasn't shown that he can CONSISTENTLY OUTPERFORM THE S & P 500 WITH HIS STOCK RECOMMENDATIONS. I'll reserve my judgement as to whether recommending sale of UNPH was a good idea. Remember, Brinker could have simply gone to a HOLD like he has done with other stocks, right? Best Regards. Rillinois P.S. I'm going to Florida, so I'll post more when I get back.