Viewing Month: July 1950

Tabell’s Market Letter – July 07, 1950

Tabell’s Market Letter – July 07, 1950

Tabell's Market Letter - July 07, 1950
View Text Version (OCR)

. '- Wolston,Hoffmon &, Goodwin SAN fRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, PA. – – —1 LOS ANGELES. CALIF. BAKERSFIELD BEVERLY HillS EAST ORANGE, N. J. HARTFORD, CONN LONG BEACH MODESTO OAKLAND RIVERSIDE SACRAMENTO SAN DIEGO SAN JOSE EUREKA FRESNO HAGERSTOWN, MD. HARRISBURG, PA. PASADENA PITISBURGH, PA PORTlAND, ORE. SANTA ANA SEAnLE, WASH STOCKTON VAllEJO TABELL'S MARItET LETTER ,.' 35 All STREp1. NEW YORK 5, N Y. Digby 4-4141 HOTEL WALDORF-ASTORIA PLaz.!l 96860 The market reached a condition of relative stability in the past week as compared with the hectic fluctuations of the previous week. Since the sharp drop of June 27th,' the industrial average has held in a trading , range between 216.99 and 205.92. Friday's close was 203.59. The rails have held in a range between'53.84 and 50.66. Friday'S close was 52.29. , My technical work continues to indicate that the current decline is an intermediate correction in a major uptrend. At the lows of last week, the industrials had retraced about one-third of the approximately sixty- eight point advance from the June, 1949 lows. That is the minimum correct- tion. One-half to two-thirds is regarded as the maximum. Whether the lows of last week hold depend largely on news developments. If they do not,there are strong support levels all the way down to 185 which would be the maxi- mum two-thirds correction. The downside indications on individual issues point to the 205-195 range as the most likely area where this intermediate decline will bottom out. Would use suc'h a possible decline to purchase stocks. Listed below are three groupings of issues that appear to have attractive technical patterns for long term appreciation. Purchases should be made during periods of market weakness and not on strength. BETTER GRADE MEDIUM GRADE SPECULATIVE XAluminum Co.of Amer. Anderson Clayton )lAtchison,Top. & S.F. Caterpillar Tractor Columbian Carbon Fairbanks Morse Federated Dept.Stores General Electric X General Motors ,i Ingersoll Rand Kennecott Copper Allied Stores Associated Dry G. Avco, pfd. Bullard Burlington Mills California Pack. Carrier Corp. …,…..Celanese Chic. Pneu.Tool Chicago,Rock Island City Stores American Airlines American Airlines,pf American Export Lines Amer.& Fgn Pr.2nd pf Amer. Woolen Boeing Air Bohn Aluminum Braniff Airways Budd Co Capital Airlines , Kresge Libbey-OWens-Ford May Dept.Stores McCrory Stores Mercantile Stores Montgomery Ward National Dairy National LeaCl. Otis Elevator OWens Illinois Penney (J. C ) Pfizer (Chas.) \Pullman Sears, Roebuck ., Stand.Oil of Calif. Stand.Oil of Ind. Stand.Oil of N.J. Union Pacific United Carbon Western Auto Supply Westinghouse Elec. Youngstown Sheet & T. Combustion Eng. Chic. Great West. Crown Zellerbach Chic.lnd & L. . -Distillers Seagram Chic.Mil & St.P. pf Electric Boat Denver & Rio Grande Firestone Tire Eastern Airlines General Tire \lttf4Elastic Stop Nut Hewitt Robins,Inc. oodall Sanford Illinois Central Gray Mfg Inter. Minerals c Interstate Dept!St. Gulf,Mobile & Ohio Long Bell Lumber Lambert Co. ' M-K-T, pfd \'!\eIlIClJ'Q Lerner Stores Lowenstein Radio-Keith-Orpheum Reynolds Metals McGraw ,Hill St.Louis-San Fran ()' National Dept.St. Seaboard Airline Northern Pacific Spiegel pef U Pacific Mills' fjvlHM XRepublic Steel Sunshine Mining T.W.A. Schenley United Airlines Smith (A.O.) United Stores,2nd pf Southern Pacific Western Airlines Southern Railway Western Union Texas & Pac. Rwy. Wyandotte Worsted ,; !- I Twentieth-Cent.Fox Western Pacif-ic July 7, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN This memorandum Is not to be con,trued , n offer or sollclt.!ltlon of offers to buy or '011 any securities. From time to time Walston, Hoffman & GoodwIn mlly hllve an Interest In some or all of the socurities mentioned hereln The foregoing material has been prepared by us as a matter of Information only. It Is based upon information believed reliable but not necessarily comlete. Is not guarnteed liS accurate or final, oIInd I, not in,tended to foreclose independent Inquiry. I — –

Download PDF

Tabell’s Market Letter – July 14, 1950

Tabell’s Market Letter – July 14, 1950

Tabell's Market Letter - July 14, 1950
View Text Version (OCR)

Walston-Hoffman & Goodwin' '..,. , ;; SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, PA. LOS ANGELES, CALIF. BAKERSFIELD BEVERLY HILLS EAST ORANGE, N. J. HARTfORD, CONN. LONG BEACH MODESTO OAKLAND RIVERSIDE SACRAMENTO SAN DIEGO SAN JOSE EUREKA FRESNO HAGERSTOWN, MD. HARRISBURG, PA. PASADENA PITTSBURGH, PA. PORTLAND, ORE. SANTA ANA. SEATTLE, WASH STOCKTON VAllEJO TABELL'S MARKET LEnER 35 WALL STREET, NEW YORK 6, N. Y. Digby 4-4141 HOTEL WALDORFASTORIA PL… 9-6860 The Ldustrial average reached ,1eW low territory 0, Thursday at an , 'itra-day low of 195.40. This is apprOXil;13.tely a 48 retraceme,-,t of the adL va.1ce from the June, 1949 lows. The rail average held stubbor'11y above the , . '50.66 low reached C' June 27th, l'lhich was a 44 retracement of the oe year' 11 . adva'1ce, The low of last week was 51,75. The fact that the i1dustrial aver, ',age met support at the expected 195 level, plus the divergent action of the two averages gives credence to the probability that the market has reached ,its low for the interrr,ediate phase. The short term indicator registered a buy signal at Thursday's close ;of 197.44. Trading purchases appear justified on minor dips. The iter mediate term indicator is deeply oversold but has not as yet registered a buy signal. Some further time may be required for this longer term indicator to confirm the change in trend. Expect further wide swings on news developments but, at last week's lows, it would appear that the market had piscounted the worst that could be expected at the moment. A probable pattern would be an attempt to rally to the 210-212 area followed by consolid tion in the 210-205 area. The outer limits could be stretched to 215 and OQ. , This week's market was featured by the diverse action of various groups with trader's selling those issues that would appear vulnerable in a ' , defense or semi-war economy and buying issues that Iwuld not be particularly; hurt by a partial imposition of excess profits taxes,controls, allecations ' , .and the various anti-inflationary devices of the 1942-1945 period. Actually ' the market is trying to discount something that hasn't yet happened and may or may not happen. This becomes an even more hazardous operation when it s not certain that the patterns of World War II will be followed in the evellt ' ..that we approach a defense or partial war economy. ', 'l'he market of the past week has favored rails, steels, su;ars, tex, ;–',;tile's ;-metals. aircrafts, airlines,- oils, retails and-ot-her ,groups with i'strong tax bases and earnings prospects. A great many of these issues held , above the late June lows last week, even though the industrial average propped ten pOints lower. For near term-trading purchases, these issues appear attractive. I have listed below a number of these issues, together , with the lows of late June. A downside penetration of these lows would jni dicate a change in the now favorable trend. Allis Chalmers (28 3/4). Aluminum Co. (54 3/8), American Airlines (9 5/8), American Car & Fdry (22), Arner. Export Lines (17), Amer. Sugar (46), Amer' Woolen (23 1/8) Anderson Clayton (55),-Armco Steel (34), Acchison, Top, ' , & S.F.(108 Atlantic Coast Line (42), Bethlehem Steel (33), Black & Decker (262 ), BOhn Aluminum (24)/Bullard f17) Burlington Mills (19) California Pack (37) Chicago Great West (134) Chicago,Mil.St.Paul,pfd. (28 3/8) Chicago & Northwest.(ll) Chicago Pneumatic (26 lj8),ChiCago, ;, Rock Island (36 3/4) Colorado Fuel (15i) Columbian Carbon (302 ) Conti- 1 '; nental Motors (5 7/8) Del. Lack & West (7)' Denver & Rio Grande West (242 ), Eastern Air (13 5/8) Eastern Stainless Steel (12) Elastic Stop Nut (8) ; Electric Boat (l6i) Fansteel Ietal (11 7/8) Francisco Sugar (lli) Georgia, Pacific Plywood (11 3/4) Gulf,Mobile & Ohio (12 7/8) Illinois Central , (35 3/8) Ingersoll Rand (63) Interlake Iron (13 1/8) International Har- . i vester (25 1/8) Jones &; Laughlin (30 1/8) Kansas City Southern (44.) '' Kennecott COI;lper (52 3/4) Lockheed Air (28 1/8) Lowenstein (25) Mesta !' Machine (38t) Missouri-Kansas-Texas pfd (22) National Lead' (40i) Newport! Ind (10 3/4) New York Shipbuilding P6) Northern Pacific Rvry (17) ,' Northwest Air (8) Pacific Mills ..(302) Pan American Air (8) Phelps Dodge (47) Pitts. Consol Coal (24) Pressed Steel Car (7 3/8) Pullman (31 3/4) Revere Copper (20) Reynolds Metals (21) Rheem Mf (22) Richfield Oil i, ' (40 1/8) St.Louis-San Fran ( 9 7/8) Schenley (31) Seaboard Air (26 1/8) Shamrock Oil (24) Shell Oil (39i) Sinclair (24) Southern Pacific (49) Southern Rwy (32 3/4) SI;lerry (27 3/8) Std.Oil of Ind. (46 1/8) Tenn.Corp. (Hi) Texas Co. (62 5/8) Texas & Pac. Rwy (48) Thompson Prod. (52) UEion Oil of Calif.(25 5/8) Union Pacific (81) United Airlines (13 3/8) United Aircraft (27 1/8) U.S.Foil (15) U.S.Freight (14 3/4) U.S.Steel (31) Vanadium (25) West Va. Coal & Coke (12 5/8) Western Air (7i) Western Md Rwy.(13) vlest.Md. pfd (28) West Union Tel A (253/4) Weston Elec.(23) Wheeling Steel (26 1/8) White Motor (17) Woodward Iron (35). ,. Jllly 14. 1950 EDMUND W.TABELL This memorandum Is not to be construed as an offer or solldtatlon of off.n to buy or lell any securities From time to time Walston, Hoffman & Goodwin may have an Intered In lome or all of te securities mentioned herein. The foregoing material has been prepared by us as a matt.r of Information only. It Is based upon Information b.nned r.nable blrt not nocessarily compl.te, Is not glUlranteed as accurate or final, lind II not Intended to foredose Independent Inquiry. u …. ,… . . . . . . . . . , ,….,,'…… , ………., ; , .. .. ………………..

Download PDF

Tabell’s Market Letter – July 21, 1950

Tabell’s Market Letter – July 21, 1950

Tabell's Market Letter - July 21, 1950
View Text Version (OCR)

…../…… ……… ' .. '. Walston.Hoffman (\ Goodwin SAN FRANCISCO, CALIF. NEW YORK. N. Y. PHILADELPHIA, PA. LOS ANGELES, CALIF. BAKERSFIELD BEVERLY HILLS EAST ORANGE. N. J HARTFORD, CONN LONG BEACH MODfSTO OAKLAND RIVERSIDE SACRAMENTO SAN 01 EGO SAN JOSE EUREKA FRESNO HAGERSTOWN. MD. HARRISBURG, PA. PASADENA PITISBURGH, PA. PORTlAND. ORE. SANTA ANA SEATIlE, WASH STOCKTON VALLEJO TABEll'S MARKET LEnER 35 WALL STREET. NEW YORK 5. N. Y Digby 44141 HOTEL WALDORF.ASTORIA In last week's letter we noted 'that the ability of thPeLoin96dB6u0 strial average to hold above the 195 support at 195.40 and the divergent action of the rails in failing to react below the June 27th low of 50.66 probably indicated that the market had reached its low for the intermediate phase and that the pattern suggested an attempt to reach the 205-212 area. Also we noted that a change in leadership was expected and listed a large number of issues that appeared favored in a defense or semi-war economy. This week the market staged a strong rally led by the type of issues mentioned. The rail average reached new high territory for the year on Friday at 59. 83. The industrials rallied into the 205-212 range to reach a high of 208.89. Rails, steels, oils, metals and textiles were the strong.groups. The advance has been rapid and some consolidation may be needed to strenghthen the technical pattern. Recommended issues should be bought 'during periods of market weakness. Four weeks have elapsed since the invasion of South Korea on June 25th. The confusion and emotionalism of the early days has passed. The situation and pattern is still far from clear but there are a number of things that appear to be at least probabilities if not certainties (1) The Korean happening is probably not an isolated incident. It will probably be followed, over a period of months and years, by similar incidents in various parts of the world. (2) This implies continued ,spending over a long period of time to build up not only our own defenses but those of other non-Communist nations. (3) It probably does not mean all-out war. The production of Soviet Russia and her satellites is not sufficient to cope with this country at this time. As of 1948, America produced more than half of the steel in the entire world and four times as much as Russia. We produced almost two-thirds of the petroleum and almost ten times as much as Russia. With Canada, we produced more than half the world's copper and six times as much as Russia. Even with all of Europe and Asia in the Soviet'p hands, it would take time to build up a production of these vital materials equal to ours. (4) The happenings of the past four weeks mean inflation. There never has been a deflationary war. The value of money will be downward. (5) Business will be good and remain good for a long period of time. All fears of a nearby depression can be eliminated. (6) The amount and form of taxation, controls and allocations will depend on war developments, but it does not appear that there will immediately be more than a moderate amount of curtailment of civilian production. It will be a sort of twilight period between war and peace. (7) Under such conditions, some companies will be less vulnerable than others due to past average earnings and invested capital. Furthermore, in a semi-war or defense economy, the major companies will ,have less of a competitive advantage over the secondary or marginal companies. (8) This implies a change in the leadership of the market with red chip issues in the van rather than the blue chips. (9) 1\s the initial emotional phase is replaced by more sober thinking, it appears probable that the investor will deCide that, in an inflation- ary economy, the ownership of common stocks is preferable to holding cash or high grade bonds. July 21, 1950 EDMUND W. TABEL WALSTON, HOFFMAll & GOODWIN ….. This memorandum is not h/llve lin Intorest in some to or be all construed as an offer or solicitation of of the securitiu mentioned herein. The offers to buy or leU any securities From time foregoing material has been prepared by us to as atimmaettWer aho ftonIf(H)romfaftmioann & Goodwin may only. It IS based upon rnforrn/llflon believed tenable but nof necess/llrrly complete, 11 not 9ueranteed as accurate or final, lind is not intendlld to foroclose independent Inquiry

Download PDF

Tabell’s Market Letter – July 29, 1950

Tabell’s Market Letter – July 29, 1950

Tabell's Market Letter - July 29, 1950
View Text Version (OCR)

Wolston.Hoffmon &, Goodwin SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, PA. ,;- ', LOS ANGELES, CALIF. BAKERSfiELD BEVERLY HillS EAST ORANGE, N J HARTFORD, CONN LONG BEACH MODESTO OAKLAND RIVERSIDE SACRAMENTO SAN DIEGO SAN JOSE EUREKA FRESNO HAGERSTOWN, MD HARRISBURG, PA PASADENA PInSBURGH, PA PORTLAND, ORE. SANTA ANA SEATTLE, WASH STOCKTON VALLEJO TABELL'S MARKET LETTER 35 WALL STREET, NEW YORK 5, N Y. Digby 4-4141 HOTEL WALDORFASTORIA Pllllr.a 9006860 For the common stock buyer whose chief interest is in long ,'cen! capital gains rather than current income, I believe that the stocks o air- line companies present an outstanding opportunity at preset price levels. Of all of my twelve-hundred or more graphs o,r ir;ividual stocks, the air- ILles have the clearest technical pattern for subs.tant.i.al long term appre- ciation. Obviously, these issues, most of which pay no diVidends, are speculative. Also, from another an31e. they may not be suiCable vehicles for short term trading. But I believe i;l,ey .ffer the possibility of vf.ry large percentage gains cr,at'; the patlan!J'c,;'lOldei', ,L.f.cause ,1 . (1) The airlines are definitely growth issues;,…Fron; lQ40 to 19)9, passenger revenue and revenue passenger miles fi6Wnhave;icreased each year. Pas senger revenue was 53.3 million in 1940 arid, 389 .3 millioli. in 1949. Fvenue passenger miles flown were 1,052 million in 1940 and 6,816 .;- 1'1111ion in 1949. Another example of growth io; the fact that the ra'cio 'of , air passenger miles to Pullman travel was 3.90 in '1935. In 1940 it had in- Gl'oased to 12.81. In 1949 it was '(0.30. In addition, the number of air- craft in service has increased sharply. There wer.e 369 in lc,40 and 8b'5 in 1949 .. – . (2) espite this tremendous ,rcwth, the average price of airline stocks today is not much higher than in 1940. ,.' (3) In addition, at present price levels, te' average airlin, stock'is selling considerably below the 1945-1946 highs. Barron!s airline average is now o.rouncl. 40 as compared with 84.06 on January 1st', 1946. , (4) The airlines in World War II benefited greatly, .from the stii,lUlus of wartime traffic. In our present defense or semi-war ec anomy , a' similar stimulus to airline traffic should cccur. In the event of a lessening of the war tension and a return to a peace econo;ny, airiine traffic vlOuld also .tend to imc.rease..;. T.r,'ffiC for June .is e;pected,)to,,show a large gain over a year a g o . , ' ;;.'.. , (5) Costa should not rise in proportion to additibi'iail business and most of the gain, \Quld be carried, down to net earnings,' ,';;, .' ,' (6) ,The airlines, in the war period from September 1939 to Pearl Harbor advanced 60 as compared with a 10 decline in the market. In the entire war period from 1939 to 1945, the airlines showed the gre2t;est p,ercentage appreciation of any group and advanced over 400. , . (7) In the event of an excess profits tax, the airl'inea could be a ; speciai case. In World War II, they had a favored status. Their tax exemp- tion was related to mail contracts rather th&, average earnings or invested capital. While it is only a conjecture, it appeavs probable that, due to the importance of alr.l.ine transportation in a war'emergency, similar favor- able treatment would occur. (8) The safety record of airlines is showing constant improvement. According to some sources, traveling by scheduled airliner is safer than , riding in an automobile. As improved instrument landing and radar equip- ment are installed in more cities, delays and cancellations will be lower- p.d and the passellger jvo'c,ntial will be greatly increased. . (9) Express and freight shipments, which are 'now only a small and rela', tively unprofitable ;'lal't of airline revenue could increaGe sharply. . i(10) Large institutional investors, such as mut'clal funds, trtlts ,pension. funds, insurance companies and the like have a very small percentage of fj 'cheir assets invest;ed in bonds, preferred s cocks and cotmr.on stocks of the irlines due to their speculative character and uncertain income. A change or the better could release a tremendous potential demand for airline aecurities due to tl,eir growth possibilities. (11) The technical pattern.s ')1' the airline iS31;\e are. v.cr-j',,' favorable. Very s.rQng accumUlation baStS Dave been formed Wiin.;'P,,3,sibilities of wide r,ercentage appreciation from present levels. . ,, ' . (12 );'The l)obmtially unfavorable fae tors snch as ',deendence on our mail 2ubsidies and the commandering of fleets in the e',rent' of a war emergency ,la' be 'overstles;ed. A discussion of these possibiiities and a list of the most favorable 3tocks in the group, from a' tec.hiifcal viewpoint, will ;Je discussed in my next letter, ., EDl'IDllD W. TABEtL ' C t memoradumJu h s not to be construed as an offer or solicitation of offers to buy or sell any secuHtes From Ilfn to time Walston, Hoffman & Goodwin may heye an interest in some or all of the securities mentioned hersln. The foregOing material hal been prepared by UI as a matter of informofion only. It is based upon informotion believed reliable but not necessarily complete, is not gUaronteed as accurate or final, and is not intended to foredose Independent inquiry ..'.' …..- – ;.–It., – – I – I,. – ' (-..,…'.,. …. ;, .''.f, …- – – —-

Download PDF