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Hiya All:

Those CK-managers are champs of the cliff-hanger. I can't wait until Friday's announcement and next week's debates. Who do y'all think they'll be ?

Justin' case you missed one, here are all 23 of the candidates and their nomination posts (by number)... in order of appearance:

(012) .. DELL ...... Dell Computer -- first number is the post-#
(022) .. HDI ......... Harley-Davidson
(029) .. LVMH .... LouiseVitton Moet Hennessey
(035) .. NOKA .... Nokia
(038) .. TLAB ..... Tellabs -- renominated in post 124
(047) .. MDT ...... Medtronics, Inc
(049) .. DIS .......... Disney, Walt
(057) .. JNJ .......... Johnson & Johnson
(058) .. GE ........... General Electric
(059) ..................... Franco-Nevada
(064) .. ERICY ..... LM Ericsson
(071) .. SAPHY ... SAP, AG -- renominated in post 97
(075) .. INTC ....... Intel again
(084) .. RHI ......... Robert Half, International
(092) .. SLB ......... Schlumberger
(093) .. MO ......... Phillip Morris Companies
(113) .. SGP ......... Schering-Plough
(125) .. AMGN ... Amgen
(129) .. CSCO ...... Cisco Systems --- finally !
(157) .. SCH ......... Charles Schwab & Co.
(159) .. BMO ..... Bank of Montreal
(164) .. WWY ..... W.W. Wrigley & Co.
(170) .. G ............ Gillette - but withdrawn in same post, 8-(
-----------------------------------
after the bell !
(181) .. PHB ...... Pioneer High-Bred
(182) .. LUV ...... Southwest Airlines
-----------------------------------

Hope I didn't miss any.

Wouldn't that make a helluva mutual fund ? Hard to find just five, but we can discuss that in follow-up posts.


BTW: there were also other companies considered or mentioned, but for which no complete nominations were submitted. The also-rans included:

ZIGO, ALL, TRV, KRB, HELE, XRX, LECO, LU, KO, HD, CMB, RD, AUD, BSX, DNB, PG, OMC, WMT, COST, and BRK.B


happy CK-hunting ....

- DD
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Who do y'all think they'll be?

Beats me. The whole board is full of great companies - many of which are worth investing in. The big thing to remember is that we want the best of the bunch - and just because someone loses out to someone else doesn't make it a bad investment! But here's a thought or two.

(129) .. CSCO ...... Cisco Systems

I've got to say I like Cisco. I also like the idea that while still in the technology-heavy section of the port, they cater to the infrastructure rather than to the consumer (as INTC, MSFT and DELL). The only worry I'd have is whether they are really a 'king' or not... while certainly a global brand, Cisco is still something of a young company. Not that there's anything wrong with that...

In addition, picking a 'Cash Prince' (see the strategy message board for more) would add a bit of variety while still generating the numbers we like to see.

(093) .. MO ......... Phillip Morris Companies

It's tough to find someone with the sheer exposure to the consumer market like MO. The pending lawsuits are certainly cause to think about it a little, but if we're looking 20 years down the road? I don't think they'll have a problem. Even if they have to pay off, they've got the resources to do so - and they've also got the products to keep generating cash while they do so!


(022) .. HDI ......... Harley-Davidson
(049) .. DIS .......... Disney, Walt
(057) .. JNJ .......... Johnson & Johnson
(058) .. GE ........... General Electric
(164) .. WWY ..... W.W. Wrigley & Co.
(170) .. G ............ Gillette - but withdrawn in same post, 8-(


I like 'em all. Who wouldn't? While they all certainly meet 'global brand' and 'repeat purchase' criteria, I'm not sure if the numbers look good enough (remember - this is in comparison to the other companies from which we select!) to justify passing on another position - say CSCO...
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Answering my own questions:

>> Who do y'all think they'll be ? <<

Might depend a little on how the CK-managers see the portfolio fitting into the "Foolish Universe". If all the 4 ports (Fool, Drip, Boring, CK) are considered in totality, rather than as completely separate entities, then you might consider tying one-hand-behind-your-back and penalizing companies already in other ports. F'rinstance do you want 2 ports overweighted in CSCO, or INTC (or even JNJ ?) . Depends on if the lesson is "A good company can be found in many ways" {pick CSCO twice} - or - "There's lots of good companies out there to find" {don't pick same comp twice}.

Another "hand-behind-the-back" limit might be to keep from having too many Dow-30 (RP4 +2 already).

But for the moment, just considering building a model portfolio of CashKings, eliminating external pressures and emotion, here would be my 5 candidates.


The candidates were selected based on Business Model, Growth Projections, Repeat-Business/Consumable-Product, Margin, Flow, Brand/Mindshare, Stock performance - in that "order"

My top 5, in order of preference are:

CSCO, DELL, JNJ, GE, and WWY

If insist on a Foreign-Wild Card, then SAPHY followed by LVMH , but ranked lower than JNJ probably.

In the end, I'd still vote for DELL anyway, because it's not in any other MFool money port - and I DO let 'external factors and emotion' color investment decisions.

Last topic:
It's gotta be a model CK, so numbers count. This hurts my 'emotional favorite' HDI - perhaps the sister board on "CashKing Strategy" is appropriate place to discuss weighting of intangibles like Brand and Business-Model , even "diversification of portfolio" vs just trusting 'the-raw-numbers'. If emotion counts, I think it would be cool to see Tom G. cruising into Sturgis for Harley's in his leather jacket and Fool-Cap.
100th anniversary coming in 2003. Be there.

Cheers !
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The idea of cash king investing is investingin a company with superior earning power,that means companies with high gross margins,a brand name, high market share,a light business finally resulting in extraordinary balance sheet strenght.Its essentially a low risk investment approach,or speaking with Warren Buffets language: a business,even fools cannot run to the ground.

This would disqualify co.like Southwestern (capital intense,cutthroat business) and also perhaps co.like Nokia,Ericsson ( no extraordinary market shares,lookalike products, Dell:also cutthroat business...) I would rather buy a co. in a stable non price elastic consumer market than a cash rich co.in a technology market. the reason for this is,that technology may change quickly and cash may dwindle fast but brand recognition not...
I would also like to dilute JNJ from the list,because its another drug stock, but doesn't meet the cash king criteria as well as PFE.
If we look at market share, brand recognicition and gross margin,there is still left:

LVMH
GE
Disney (but highly leveraged)
Medtronic
WWY
MO (but the tobacco deal looms..)


Following this approach,I think LVMH (this is my favorite) WWY and Medtronic should make as viable C-K's. All three co. totally dominate their markets. I have to admit that both WWY and Medtronic beat LVMH by the numbers. LVMH (or LVMHY ticker symbol) hasn't the superior shareholder returns that both WWY and Medtronic have.
However,I think that a foreign stock may be a nice diversification for a CK portfolio...

IMHO
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JNJ, GE, WWY offer DRiPS.

Absolutely free for JNJ, WWY.

$1 auto check/savings withdrawl (EFT) for GE otherwise $3 optional cash payment charge.

Fishlip
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After having nominated Dell for a Cash King I'm having second thoughts.

Phil has reminded me of an important aspect of a Cash King that I failed to fully appreciate. Thanks Phil. That is, a Cash King should be a company that you can forget about for a looooooong time without worrying and following it very much, if at all. As much as I like Dell I'm not sure I can put it aside and check on it in ten years the way I could feel comfortable with Coke, for instance.

On the other hand, I'm not sure I feel that way about Intel or Gap either.

And actually there are very few of the nominated CK's that I feel that way about. Maybe GE, Disney, J&J, but that's about it. Cisco seems to be popular but no way does it qualify for this "subjective" criteria in my opinion.

Also, isn't part of the idea of a Cash King that it is a household name, a company MANY people have heard of, like Coke? If that's an important criteria then most of the nominations are eliminated right there.

For what it's worth....

Fool For Da
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Also, isn't part of the idea of a Cash King that it is a household name, a company MANY people have heard of, like Coke? If that's an important criteria then most of the nominations are eliminated right there.

I'd have to agree to some extent... but if you look at it, many times there is *something* about a company that doesn't quite match all the criteria. Whether this something is a financial criteria or brand recognition shouldn't matter (much).

With that said, I don't know which is better - a relatively unknown product with tremendous financials or a really well known product, positioned well, but with some lackluster performance in margin - or even a company somewhere in the middle.

I think with any C-K you have to evaluate the whole company to see where they're going. A smaller mind share might not always be a bad thing. For an interesting discussion of it, check the C-K Strategy folder for the Cash-Prince thread.

Let's look at Intel (INTC) or Microsoft (MSFT).

They've both got reams of cash, little debt, and substantial mindshare in their market. But go outside of that market - nationally or internationally - and how much of a household name do they possess? In both cases, it's not actually too bad. But, believe it or not, there are still people who don't use a PC daily - or at all. To them, Microsoft may sound like a disease dreaded by all male actors in the adult film industry. But who wouldn't have liked to get in on them ten years ago, while they were still small players in an ever-increasing market? This is the role of the Cash-Prince.

Now let's take a glance at Cisco (CSCO). While the market they serve is certainly somewhat specialized, and relatively unexposed to the public (at least from an end-user standpoint), what a market! It seems like every week I'm reading somewhere about new advances in communications hardware... and who is one of the biggest players in that market? Cisco. Sure, you can also talk about Tellabs (TLAB) and Lucent (LU) sharing that market. Who will become the gorilla? Tough to say - maybe we ought to buy all three and when one starts to emerge as the leader, cash out of the other two and plug it all into #1.

But the fact is - the market they serve is big. And it's only going to get bigger. What's more, throughput advances occur regularly. As more and more people decide to get on the Internet, you need a bigger pipe to send the data through. More people are also turning to IP telephony - something needs to route all that traffic. The more traffic, the more you need to upgrade existing hardware to evolving technology that can keep up with all that traffic. Who's in the best position to get all that business? It may very well be a toss-up. But I like Cisco's chances.

It is definitely true that the average person on the street may not recognize the name (or more likely, they'll think you're talking about the amazing lard product). But if you are in that market? If you need to complete your WAN? I'll bet you most anything that you'll turn to Cisco - or at the very least, consider them as an option.

Now there is a slight disadvantage in their products - the market is inherently limited. Unlike Coke (KO), every school kid walking down the street may not recognize the name (although many might be more likely to do so than say T. Rowe Price). I don't think it's likely you'll find a vending machine for routers at every gas station at any point in the near future. But how many products *can* you say that about? And how many companies are as well positioned to take advantage of an exploding market segment? Not many. As for me, I wouldn't mind being in a position to take advantage of that.

One last thought. While it is nice to think of holding a stock for 10 (20, 30, 40) years without giving it any thought, can we be realistic and expect every one of our choices to do so well? I certainly can't. So I monitor the C-K holdings in my port just as I do the FF holdings. That is to say, about once a year. The day-to-day fluctuations aren't going to bother me, and I could never be mistaken for a day-trader.

But if a company is trending downward, I'm not necessarily going to stay in them for a decade just because I bought them with that intention. If the management is still solid and seems interested and devoted to turning things around, I might stick it out for a few months or another year (or more). I will not follow them to the bottom just because I've only held the stock for three years and I've got at least seven to go. And most importantly - I'm going to continue doing research so that I recognize those trends. Just because it's a C-K stock now doesn't mean I won't check the numbers again for a decade...
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CalicoJoe, first of all thank you for the response. I like your thoughts.

CalicoJoe says: "Microsoft may sound like a disease dreaded by all male actors in the adult film industry"

That is FUNNY! Micro Soft...I like that!

CalicoJoe: "But who wouldn't have liked to get in on them ten years ago, while they were still small players in an ever-increasing market?"

Sure, but that is not the point of CK's. That would fall under growth stocks, of which I am also interested. But here I am focusing on the CK portion of my portfolio.

CalicoJoe: "Cisco. Sure, you can also talk about Tellabs (TLAB) and Lucent (LU) sharing that market. Who will become the gorilla? Tough to say - maybe we ought to buy all three and when one starts to emerge as the leader, cash out of the other two and plug it all into #1"

Not a bad idea. But I'm still not sure I'm comfortable with them as a CK. I've personally never heard of them except on this board. And boy, after everything I've seen here I certainly want to check them out. They certainly seem to be well liked here. But I guess you are right that we can't always compare companies to Coke. How many could possibly come up to that kind of brand recognition!? Not many, but still, there are a lot of companies that fulfill it better than Cisco.

Thanks for your thoughts.

FFD



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>> I've personally never heard of them except on this board. <<

I think as Tom G. says, CSCO is a gimme for the final 5, but some will still question it as a brand-name consumer product.

But for everybody in the network biz, Cisco and Router (the thing that connects your local stuff to the rest of the world) are synonomous.

I am not 'in the biz', but thanks to working with collaborators around the world, I'm a heavy enough user/abuser of network resources that I find myself on various network/computing-resources committees.

I swear that I have been to meetings where in discussions of the architecture of our network, the gurus who make the purchasing decisions have pointed to a block on the diagram (labelled "router") and said "then it passes to the Cisco and...". For those of you looking for Mindshare like asking for a Band-Aid or a Kleenex (instead of a adhesive bandage or facial tissue), Ciscso is there already.

As with all technology this position could be attacked, but no risk - no reward.
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<<But for everybody in the network biz, Cisco and Router (the thing that connects your local stuff to
the rest of the world) are synonomous.>>

I'm not a net techy either, but I have to absolutely agree that router=Cisco. When I overhear the net admins talk, what I actually hear is a single word....Ciscorouter. And apparently no company can ever have enough, what with firewalls, mini-firewalls, local, semi-local, sorta wide area, etc. nets springing up to meet corporate communication needs.
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