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Foolish Special

[ December 11, 2000 ]

Foolish Favourites Christmas Special

By Stuart Watson (TMFTiger)

How has your portfolio performed this year? No doubt you have had your ups and downs, and quite probably more of the latter. But how has Fooldom as whole done over the last year? We have a little toy here at Fool HQ which lists the most popular shares entered into our portfolio system. We have taken the top 50 holdings just to see how the "average" Fool, if there is such a person, might have performed over the last year. First of all we have summarised the biggest winners and losers among the top 50 holdings in Fools' portfolios, and then we have the full list of the top 50.

The Winners

Old economy rules OK! The top five this year are all well-known firms. However, the fact that the top spot was claimed with a gain of less than 50% just illustrates how tough this year has been.

1. Tesco (LSE: TSCO) +48%

The UK's largest supermarket chain takes the top spot. As well as putting in a solid performance on the operating front it has also made great strides in the fledgling market of online retailing. Its expansion plans in Eastern Europe and Asia have also won plaudits, making it one of the few UK retailers that has been able to repeat its domestic success overseas.

2. Centrica (LSE: CNA) +39%

A boring old utility snatches the number two slot. In fact that's being a little unkind to Centrica. It has impressed many with its progress since being demerged from the old British Gas group. It has moved into financial services with the Goldfish card and entered the motoring market with the purchase of the AA. Its latest plan is to expand into the telecoms arena. On the mobile side it teamed up with Vodafone Group (LSE: VOD), whilst for fixed-line access its partners are Cable & Wireless (LSE: CW.) and Kingston Communications (LSE: KCOM).

3. Allied Domecq (LSE: ALLD) +39%

The drinks firm Allied Domecq has been hiding in the shadow of the much larger Diageo (LSE: DGE) in the last few years. The long-term performance of the shares has been pretty dreadful and they have made all of this year's gains in the last few weeks as interest grows in the outcome of the £5b auction of Seagram's (NYSE: VO) drinks business. Allied Domecq recently negotiated the right of first refusal to take over Captain Morgan Rum.

4. BAA (LSE: BAA) +36%

Another dull utility! BAA shocked the market last autumn with an intra-EU duty free inspired profits warning that knocked 30% off its share price. This year has been spent rebuilding the confidence of investors and so far they seem reassured by BAA's progress although it will be a little while until profits fully recover.

5. Reuters (LSE: RTR) +31%

Creeping into the top five we have the sole technology-related company. Reuters, the provider of information services, is one of the world's top brands. Although profits have been static for the last three years investors have got excited about Reuters electronic trading system, Instinet, and its investment in Internet infrastructure company Tibco (Nasdaq: TIBX).

The Losers

You won't be surprised to discover that all of the year's biggest losers are technology stocks and that four of them are Internet-related. The biggest loser of all, although not among the top 50 companies in our list, was QXL (LSE: QXL) which has lost 96% since the start of year and some 98% since its peak in April.

1. Durlacher (LSE: DUC) -85%

The Internet investment bank has had a rollercoaster year. At one point its market value exceeded £2b but it is now less than £150m. Alongside its investment in early-stage Internet companies it also has stockbroking and corporate finance divisions that are still bringing in the readies. Its biggest investment is currently in 365 Corporation (LSE: TSF).

2. Eidos (LSE: EID) -81%

Lara Croft may be able to fend off most of the baddies that come her way but she has struggled to overcome the biggest nasty of all, a disillusioned stock market. The price of computer games has tumbled prior to the launch of PlayStation 2 and this has sent Eidos spiralling into losses. It was involved in bid talks and has parted company with its Chief Executive and Finance Director. All in all, the year 2000 is one Eidos would like to forget.

3. Lastminute.com (LSE: LMC) -81%

Lastminute has the dubious distinction of being the most infamous flotation of recent years. Many of the 189,000 people who applied were upset with their allocation of just 35 shares, which are currently worth just £25. Its flotation was seen by some as the final straw that broke the technology bull run but as it raised just £125m that seems to rather overstate its significance compared to a stock market valued at some £2,000b at the time.

4. Interactive Investor International (LSE: IIN) -79%

The fortunes of the UK's largest finance website have mirrored that of Lastminute. When it floated, its discussion board here on TMF was getting 300 posts a day. But it has had just 50 in the last three months. Once tech euphoria started to whittle away Interactive Investor found it had to pull back from its international expansion plans and move towards selling financial products. Investors are yet to be convinced and the company is currently valued at just £50m, the same value as its cash balances.

5. Freeserve (LSE: FRE) -75%

Freeserve was the first major Internet flotation in the UK and the London Stock Exchange had to relax many of its rules to allow its flotation to proceed. Many investors might wish it hadn't. Its market value has gone from an initial £1.5b to over £9b and then all the way back to £1.5b again. It has successfully retained its position as the UK's number 1 Internet Service Provider but investors have recognised that a small market like the UK doesn't give it sufficient scale. The company has recently announced that the French ISP, Wanadoo, is to take it over.

Finally, here is the top 50 in all its gory glory. There are just 17 shares in positive territory and 14 shares have fallen by more than 50%. The numbers in brackets represent the company's position in the top 50 in terms of total Fool portfolios containing the shares.

Company                          Popularity  % change 
1.  Tesco (LSE: TSCO)                  (12)    47.9
2.  Centrica (LSE: CNA)                (17)    39.3
3.  Allied Domecq (LSE: ALLD)          (38)    39.0
4.  BAA (LSE: BAA)                     (37)    36.4
5.  Reuters (LSE: RTR)                 (49)    31.1
6.  Powergen (LSE: PWG)                (20)    28.0
7.  Unilever (LSE: ULVR)               (29)    26.5
8.  Glaxo Wellcome (LSE: GLXO)         (13)    13.5
9.  SmithKline Beecham (LSE: SB.)      (32)    13.4
10. Royal & Sun Alliance (LSE: RSA)    (18)    13.3

11. Scottish Power (LSE: SPW)          (22)    12.7
12. Barclays (LSE: BARC)               (46)    10.9
13. Abbey National (LSE: ANL)           (8)    10.4
14. Shell (LSE: SHEL)                  (43)     4.9
15. BSkyB (LSE: BSY)                   (50)     2.8
16. Boots (LSE: BOOT)                  (19)     1.1
17. Logica (LSE: LOG)                  (36)     0.2
18. British Airways (LSE: BAY)          (9)    -1.8
19. Railtrack (LSE: RTK)               (41)    -7.6
20. Pace Micro Tech (LSE: PIC)         (25)    -8.2

21. Halifax (LSE: HFX)                  (4)    -8.3
22. BAe Systems (LSE: BA.)             (42)   -11.0
23. Lloyds TSB (LSE: LLOY)              (6)   -12.5
24. Rentokil Initial (LSE: RTO)        (34)   -12.5
25. BP Amoco (LSE: BP.)                (44)   -13.0
26. Cable & Wireless (LSE: CW.)        (15)   -13.7
27. Vodafone Group (LSE: VOD)           (1)   -17.1
28. Alliance & Leicester (LSE: AL.)    (24)   -17.3
29. ICI (LSE: ICI)                     (14)   -26.9
30. Imagination Technologies (LSE: IMG)(35)   -33.5

31. Marks & Spencer (LSE: MKS)          (2)   -34.7
32. Marconi (LSE: MONI)                (21)   -34.7
33. Tate & Lyle (LSE: TATE)            (45)   -36.8
34. Baltimore Technologies (LSE: BLM)   (7)   -39.2
35. ARM Holdings (LSE: ARM)             (5)   -42.2
36. Sage (LSE: SGE)                    (31)   -46.3
37. Scoot (LSE: SCO)                   (26)   -50.7
38. NXT (LSE: NTX)                     (27)   -52.0
39. Psion (LSE: PON)                   (10)   -52.5
40. Trafficmaster (LSE: TFC)           (33)   -57.9

41. British Telecom (LSE: BT.A)         (3)   -58.9
42. Kingston Communications (LSE: KCOM)(40)   -61.2
43. Telewest (LSE: TWT)                (30)   -67.8
44. Geo Interactive Media (LSE: GIM)   (28)   -68.0
45. Rage Software (LSE: RGE)           (39)   -73.8
46. Freeserve (LSE: FRE)               (16)   -75.4
47. Interactive Investor (LSE: IIN)    (23)   -79.3
48. Lastminute.com (LSE: LMC)          (11)   -80.7
49. Eidos (LSE: EID)                   (50)   -80.9
50. Durlacher (LSE: DUC)               (48)   -85.5

Average performance                           -20.6%

Note: Price change is from Jan 1 to Nov 30. List of the most popular Foolish holdings taken as at this August. These data are only produced on an aggregate basis: we don't know what individual users have in their portfolios.

Where Next?

How have you done this year? Let us know on the Fool's Eye View discussion board