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Letter to the Editor

This article originally appeared in the November 2002 Issue of INSIGHT

Ups and Downs

I am becoming rather philosophical about the Stock Market nowadays. I have developed a certain sense of detachment which has served my blood pressure reading well lately. Watching the 200 point gains and the seemingly reflexive 200 point losses that have become almost daily occurences without detachment could be quite harmful to my health.

The mood swings we are seeing in the Market look as though they may be here for a while, at least until the end of 2002, but the combination of ups and downs is certainly better than downs alone.

Our paint company stocks, with the exception of Valspar, are a bit down this month, especially Akzo Nobel, off 28 percent from its January price. However, Q3 financial reports from the major refinish paint suppliers are encouraging. Careful attention to continued cost-cutting and and to improved efficiencies in each company’s business divisions are measures these companies have been wise to implement.

3M has recently reorganized its business into seven units from six to sharpen its focus on markets and customers. The company has been holding its own in an international market in which others have taken it on the chin throughout 2002.

Copart, despite a disappointing showing in the Market, with its stock price down to one-half of where it started this year, is sticking to its expansion and acquisition plans. Locations look good, and I expect 2003 to be a successful year for both Copart and the other big salvage auction yard operator, Insurance Auto Auctions.

My own stock portfolio’s favorite child is fast becoming CCC Information Systems, up just under a whopping 167 percent this year. CCC has been doing everything right in 2002 - concentrating on its core business and finetuning its services and software products.

An indication that the company is moving in the right direction - up - is CCC’s recent purchase of the Trust Preferred Securities issued by CCC Capital Trust to Capricorn Investors III, L.P., one of its major stockholders. The total amount of the purchase was $16.3 million.

A whole year of bad news from the dot-coms continues. The golden children of a few years ago continue to sink down, down, down. Parts.com shares are virtually worthless this month, and the one upbeat dot-com news item that INSIGHT reported last month turned out to be a "Never mind" thing. Drivershield and eAutoClaims are no longer planning to merge. Ah, well! Both their current stock prices added together gives you less than one dollar, so together or apart, these two companies are struggling to find an upward path.

Taking the long view, a view anyone involved in the Stock Market should always take, in my opinion, I believe that the ups and downs and general bumping around we are experiencing now as the end of the year approaches are signs of strengthening and gradual recovery.

INSIGHT wishes a Happy Thanksgiving to all our readers! We are thankful for you and for this great U.S. of A!

-Charles Baker-

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