Viewing Year: 1950

Tabell’s Market Letter – May 12, 1950

Tabell’s Market Letter – May 12, 1950

Tabell's Market Letter - May 12, 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. LONG BEACH MODESTO OAKLAND PASADENA SAN DIEGO SAN JOSE SANTA ANA EUREKA FRESNO HAGERSTOWN, MD. HARRISBURG, PA, PITTSBURGH, PA. RIVERSIDE SACRAMENTO SEATTLE, WASH STOCKTON VALLEJO TABELL'S MARKET LETTER 35 WALL STREET, NEW YORK 5, N. Y. Digby 4-4141 HOTEL WALDORF-ASTORIA' PLata 9-6860 The industrial average reached a new high this week at 219.64. The rails, however, were unable to better the high of 57.58 reached earlier in the month. The favorable long term action continues as each successive advance is consolidated and digested before an overbought condition has been reached. The action of the rails has been somewhat disappointing but it must be remembered that they have been faced with two unfavorable developments. The first was the coal strike and now the strike on four important carriers. Regardless of this fact, and while their progress has been Slow, the rail average has been in a very slow but advancing uptrend. This group could assume a position of market leadership once the current uncertainties are settled. The patterns of individual stocks show few signs of important top patterns. The oe exception was the television group which had built up some wide congestion patterns during the period of heavy volume and rapid price swings. The decline in this group recently has at least partially corrected this situation. The fact that the decline in the very popular televisions had no great effect on the general market again attests to the underlying strength of the market pattern. In the past few days quite a number of individual stocks in various groups have broken out of accumulation areas on the upside indicating the beginning of fairly substantial upmoves. In many cases these issues have been in groups that have been relatively backward here- tofore. . The leadership of the market, in the main, remains good and I see no indications of even the start of a buying climax. I would expect no more than ordinary technical corrections at this pOint. Among the stocks that have broken out of long trading ranges is FRUEHAUF TRAILER. This stock had ranged between approximately 17 and 24 since late 1947. This range was penetrated on the upside and the stock sold above 25. This confirms the potentially favorable pattern and from a technical viewpoint the stock indicates higher levels. A numb.er of other issues have formed potentially favorable patterns, although they have not yet broken out of long trading ranges. One such stock is REYNOLDS METALS. After adjusting for the 10 stock dividend in December, 1949, the stock has held in a range between 17 and 26 Since early 1947. Ability to reach new high territory would also confirm its favorable pattern. A great many individual stocks in the oil group have also broken out on the upside of trading ranges and indicate a favorable trend. The action of the oil group early in the year was rather discouraging but Since March 15th the technical performance of this group has improved considerably. Among the oil stocks that have recently penetrated trading ranges on the upside are PURE OIL, OHIO OIL, RICHFIELD OIL, SINCLAIR, CONTINENTAL, TIDEWATER ASSOCIATED, PLYMOUTH, LION OIL, and SHELL OIL. May 12, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN This momorandum Is not hayti an Intared in some to or be all constnJed as an offer or solicitotion of of the securities mentioned herein. The offofreergsotiongbumyateorri.!!s1ellh.!a!snybeseencurpirtipe.s!!rFerdomby time us to as !l time Walsto.. Hoffman matter of Inform.!!tlon o&nlyGooIdt IS.inb.!m!l3eYd upon Information believed reliable but not necessarily complete, Is not guaranteed as accurate or final, and IS not Intended to foreclose Independent Inquiry

Download PDF

Tabell’s Market Letter – May 19, 1950

Tabell’s Market Letter – May 19, 1950

Tabell's Market Letter - May 19, 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. LONG BEACH MODESTO OAKLAND PASADENA SAN DIEGO SAN JOSE SANTA ANA EUREKA FRESNO HAGERSTOWN, MD. HARRISBURG, PA PITTSBURGH, PA. RIVERSIDE SACRAMENTO SEATTLE, WASH. STOCKTON VALLEJO TABELL'S MARKET LETTER 35 WALL STREET. NEW YORK 5. N. Y. Digby 4-4141 HOTEL WALDORFASTORIA PLaxa 96B60 The industrial average reached new high territory on Friday at 222.79, The rail average at the day's high of 57.23 was close to the recent high of 57.58. The market has now advanced over sixty pOints from the June, 1949 low. The advance has been steady and orderly with only minor corrections. Each advancing phase has been followed by a consolidation and digestion of the rise. The leadership, on the whole, has been good. In fact, while the better grade issues have advanced into new high terri- tory Since 1930, many secondary and speculative issues are still selling at price levelS 50 below their 1946 highs. Despite this long and steady rise, there are no important indications of an important top. The industrial average is now close to the minimum objective of 225 mentioned for a long time in this letter. Never- theless, most of our long term and intermediate indicators show no Signs of an overbought condition. The short term indicator has on several occasions since June Signalled a temporary overbought condition. However, on each occaSion this has been corrected by a consolidation rather than a correction. At the moment, this short term indicator has not reached an overbought condition despite the fact that the market has rallied for five consecutive days. A sharp rally in the industrial average over the next week would result in the first signal of an overbought condition on one of the intermediate trend indicators. A resting period in the industrial average for the next few days would be the best technical ,.', action. While the rail average has not yet succeeded in penetrating the previous 57.58 high, individual rail issues have shown improving action and I would expect this average to attempt to reach at least the 60-62 level before the advance tops out. Individual rail issues have very diverse patterns and extreme selectivity is needed. The following issues have the most attractive patterns Atchison, Topeka & Santa Fe Southern Pacific Seaboard Air Line R.R. Illinois Central Gulf,Mobile & Ohio Chicago, Indianapolis & Louis.nAn Missouri, Kansas, Texas, pfd. Chicago Great Western Texas & PacifiC Railroad The following issues also have potentially attractive patterns – !, 1 . ,,'.. '1 Chicago, Rock Island Northern Pacific western' PacifiC Denver & Rio Grande Western May 19, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN ThIs memorandum Is not IIl1ve an Interest In Jome to or be all construed as an offer or sollcitl!tlon of of the securities mentioned herein. The offen to buy or sell any securities. From time to time Walston, Hoffman foregoing matenel has been prepared by, us as a matter of Information o&nlyG.ooItdISi,nbam.!l upon Information believed reliable but not necessarily complete, 15 not guaranteed as accurate or fInal, and II not Intended to forecl05e Independent Inquiry.

Download PDF

Tabell’s Market Letter – May 26, 1950

Tabell’s Market Letter – May 26, 1950

Tabell's Market Letter - May 26, 1950
View Text Version (OCR)

Walston.Hoffman &, Goodwin SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILAOELPHIA, PA. -. LOS ANGELES, CALIF. BAKERSFIELD BEVERLY HILLS EAST ORANGE. N. J. LONG BEACH MODESTO OAKLAND PASADENA SAN 01 EGO SAN JOSE SANTA ANA ) TABELL'S MARKET. LETTER EUREKA FRESNO HAGERSTOWN, MD. HARRISBURG, PA. PITTSBURGH, PA RIVERSIDE SACRAMENTO SEATTLE, WASH STOCKTON VAllEJO '.35 WALL STREET. NEW YORK 5. N. Y. Digby 4-4141 HOTEL WALDORF.ASTORIA PLaza 96860 \ ! \I It might be appropriate at this time to repeat my forecast for 1950. The reprint below was issued on December, 23rd, 1949 when the DowJones industrial average was 198.88 and the rail average was 51.53. \ My prediction for 1950 is that the industrial average will attain a high of at least 225 with a good probability that the 240-250 level will be reached. I also believe the rails will test the 63-65 level. Just when these figures will be reached is problematical. Most forecasters expect the highs to be reached in mid-year. I doubt if the low of the year is below 185. In my opinion, the market leaders, at least in the earlier stages, will continue to be the higher grade, long dividend paying issues that are yielding 5t to 8. The present wide spread between high grade bond yields and higher grade stock yields will be sharply narrowed. At this time, five months later, the industrial average has reached a high of 224.24 and the rails have reached 57.58. While the minimum objective of 225 has approximately been reached, there are no signs of the market topping out and the imminence of a sharp . decline. The entire advance from the June, 1949 lows has been orderly and each rise has been followed by a consolidation and digestion of the advance before the rise has been resumed. The market has been gOing through such a consolidation period during the past few days. The low so far this year was. reached on January 13th at 193.94. The chances of this level being again reached chis year appear to be remote . . The leadership during the entire advance has been good. With few exceptions, the bulk of the advance has been in the better grade, long dividend paying issues. The great majority of listed issues have shown onlYi very moderate price advances. In many instances, there are good reasons why these issues have not advanced. On the other hand, there are also a great many good issues that appear behind the market. In most cases these issues are in industries that have undergone some post-war readjustment and. appear at or near a turn. The recent strength in Montgomery Ward may be an indication that we are entering a new phase of the advance. As the present leaders reach new high territory, attention may shift to some of the laggard issues. Some of these issues have been backward only because the attention of the market has been directed elsewhere. The retail store and mail order issues appear to be showing some signs of strength. Allied Stores (35), Montgomery Ward (61), and Lerner (23) are issues that could show good price enhancement. Spiegel (11) is a more speculative issue in the group. The textile group shows signs of returning activity. Lowenstein (), and Pacific Mills (30) are representative issues. The distilling issues have also been backward. DistillersSeagram (19) and Schenley (32) have good patterns. The airlines have strong formations. American Airlines (11) and Eastern Airlines (15) are the, . better grade issues in the group. There are a number of special issues that also have built up good. potential accumulation patterns. InclUded in this group are Electric Boat (18), Servel (13), Penn-Dixie-Cement (25), Shamrock Oil (29), FruehaufTrailer (25) and Reynolds Metals (24). Three of our previous recommendations – American Export Lines (19), Central Foundry (9) and Elliott (22) have reacted back to support levels.–They may be slow but should rally from present levels. May 26, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN Th15 memorandum II not have an interelt in some to or be all construed as .!In of tho securitiel offer or soltdfation of mentioned herein The ofofhremgotiongbumy.1oterrialelUhaasnybeuelncurpirtieDsarlFdrombyt.iUm5 e to IU a time Wa15tcn, Hoffrpan matter of Informahon & Goodwin may only, It Is based upon Imormation believed reliable but not necessarily complete, Is not guaranteed as accurate or fInal, and IS not Intended to foreclose Independent Inquiry .

Download PDF

Tabell’s Market Letter – June 02, 1950

Tabell’s Market Letter – June 02, 1950

Tabell's Market Letter - June 02, 1950
View Text Version (OCR)

,Wolston.Hoffmon Goodwin'& ., , …. ……………………. SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, PA. LOS ANGELES, CALIF. BAKERSFIELD 8EVERlY HillS EAST ORANGE, N. J. LONG BEACH MODESTO OAkLAND PASAOENA SAN DIEGO SAN JOSE SANTA ANA EUREKA fRESNO HAGERSTOWN .MD. HARRISBURG, PA. PITTSBURGH, PA. RIVERSIDE SACRAMENTO SEATTLE, WASH. STOCKTON VALLEJO TABELL'S MARKET LETTER 35 WALL STREET, NEW YORK 5, N. Y. Digby 4-4141 HOTEL WALDORF.ASTORIA PLata 9-6860 The market continues in a consolidating phase. The Dow-Jones Industrial average has held between a high of 224.34 and 220.74 for twelve. !' trading days. The rail average remains in the narrow range in which it has' held Since February. Ability to break-out on the upside of the range, par-i ticularly on volume of two million shares or more, would be very construc- i tive and indicate a continuance of the advancing trend. A downside break- out should meet support at 217-215. ,i There' is much comment on the fact that General Motors, at Fridays high of 90 3/4 was within a point of the 1929 high of 91 3/4. On this ' basis, the stock appears to be historically high. However, such a conclu- sion leaves out the important element that General Motors today is a vast- ly larger company, from an income viewpoint as well as from balance sheet , viewpoint. In 1929, the net sales of General Motors were 1.5 billion. , The net sales of General Motors in 1949 were 5.7 billion, or almost four times as large. The earnings in 1929 were 5.49 a share and the stock paid dividends totaling 3.30 a share. For 1949 General Motors earned 14.65 and paid 8 in dividends. A glance at the balance sheet shows equally startling growth. While preferred stock increased 139.3 million to 283.6 million in 1949, cash and governments increased from 127.3 in 1929 to 913.7 million on March 31, 1950, and working capital increased from 247.6 million to 1.4 billion as of March 31, 1950. While there is no doubt that General Motors was greatly over-valued at the 1929 high of 91 3/4, the stock appears under-valued now. This confirms our technical work on the stock. This letter has stressed its favorable action on many occasions. The stock still indicates a minimum upside objective of 95-100. A great many other companies have shown a greatly improved con- dition since 1929 and yet their stocks are selling considerably below the 1929 levels. The eventual objective could be much higher. Take Illinois Central Railroad as an xample. Illinois Central sold at a high of 153t .., in 1929. This year's high has been 42 7/8. In 1929, Illinois Central \' earned 9.14 a share. In 1949 it earned 11.01 per share. Funded debt i decreased from 366.4 million in 1929 to 238.7 million at the end of 1949 i and fixed charges were reduced from 18.8 million in 1929 to 10.5 million at the end of 1949. In addition to this, cash and equivalent which equalled 7.8 million in 1929 had increased to 77.2 million as of March 31, 1950 and working capital had increased from 6.2 million in 1929 to 46.0 million as of March 31, 1950. Regardless of these improved finances, Illinois Central Railroad is selling at approximately one quarter of its 1929 high. .. / ,I The Dow-Jones Industrials at the recent high of 224.34 was selling at the higest level since September, 1930. Historically, this aver- age is high, statistically it is still cheap. That is also the verdict of ; my technical work. While my minimum objective of 225 has been approximately reached, I still believe the market will reach approximately 250 with or without a prior intermediate technical correction. June 2, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN This memorndum Is not to be construed ell n offer or lolldttlon of offers to buy or sell any securities. From time to time Wallto.n, Hoffman & Goodwin may have ,an Interett In lome or all of the securities mentioned heroin. The foregoing mllterial hs been prepared by us as a matter of ,formation only. It Is based upon Information believed reliable but not neceuarlly complete, Is not IjIll8tanteed as accurate or final, and Is not Intended to foreclose Independent Inquiry. ..

Download PDF

Tabell’s Market Letter – June 09, 1950

Tabell’s Market Letter – June 09, 1950

Tabell's Market Letter - June 09, 1950
View Text Version (OCR)

Wolston.Hoffmon &, Goodwin' .' . SAN FRANCISCO, CALIF, NEW YORK, N. Y. PHILADELPHIA, PA. LOS ANGELES, CALIF. BAKERSF(ELD BEVERLY HILLS EAST ORANGE, N. J. LONG BEACH MODESTO OAKLAND PASADENA SAN DIEGO SAN JOSE SANTA ANA EUREKA FRESNO HAGERSTOWN, MD HARRISBURG, PA PITTSBURGH, PA RIVERSIDE SACRAMENTO SEATTLE. WASH. STOCKTON VAllEJO TABELL'S MARKET LETTER 35 WALL STREET, NEW YORK 5, N. Y. Digby 4-'1141 HOTEL WALDORF.ASTORIA PLot 9-6860 After a sharp rapid dip to 218.66 on Tuesday, the Industrial average recovered sharply and, at Friday's intra-day top of 227082 was in new high territory for the past twenty years. The Industrial average has now reached the minimum objective of 225 mentioned repeatedly in this letter since our bUYing recommendations in the 160-170 level. I continue to believe that the probabilities favor reaching the 250 objective. The rail average dropped to 53.62 on Tuesday. At that level, the rails were at the lower part of the 53-57 range in which the group has held since late January. Ability to hold at the old low was constructive and the average has rallied back to 56.91. Ability to decisively penetrate the high of 57.58 would indicate a further advance to the 62-64 area. The sixty-six point advance from the June lows has been extremely selective. The leadership has been excellent. The bulk of the advance has been confined to the better grade investment issues and a few special sit- uations. The greater part of the list has shown only moderate appreciation' and many issues are selling at the same level as when the Industrial aver- ' age was in the 170-180 area. There are some signs that the secondary issues may participate more fully in the rise. The type of stocks that are showing improving action are not so much the outright speculations but the type of issues that are usually classed as business men's risks. A large number of these stocks have built up large potential accumulation patterns and appear ready to mov, I am listing below a number of issues of this type. Their purchase is reccommended on minor price dips Approx. 1949 Price Div. 1946 Yield High 1949 Earnings Allied Stores 35 1/4 3.00 8.5 63 3/8 5.18 Amer. Airlines 10 1/2 nil nil 19 7/8 .79 Amer.Export Lines 19 1/2 2.00 10 02 28'5/8 4.22 -Atchison 116 1/4 8.00 6.8 121 Burlington Mills 20 3/4 1.50 7.2 29 7/8 18.06 3.96 City Stores 18 3/4 1.20 6.4 38 1/4 2.34. Columbian Carbon 35 1/4 2.00 5.7 48 3.69 Denver & Rio Gr&de 29 1/2 2.00 6.7 39 3/4-b 6.33 Eastern Air Lines 14 3/4 nil nil 33 3/8 .82 Electric Boat 17 1.50 8.8 35 3/4 .13 Fruehauf Trailer 25 2.00 8.0 48 2.37 Gulf,Mobile & Ohio 16 1/2 .50 3.0 30 1/1 2.52 Illinois Central 41 3.00-a 7.3 45 1/2 11.01 Lambert Co. 22 1/4 1.50 6.7 68 2.29 ..Lerner Stores 23 1/4 Long Bell Lumb. A 27 2.00 8.5 2.80 10.3 44 1/2 35 2.46 2.77 \ Lowenstein, M. 26 3/4 2.00 7.5 43 3/4 4.33 i , May Dept. Stores Montgomery Ward 48 1/2 3.00 6.1 70 59 3.00 5.1 104 1/4 5.79 7.13 Otis Elevator 41 2.50 6.0 39 1/2 5.26 Penn Dixie Cement 26 1/2 1. 75 6.6 30 3/4 4.37 Reynolds Metals 24 1.10 4.5 37 5/8 4.20 Schenley 32 1/2 2.00 6.1 100 5.27 Servel 13 3/4 .30 2.1 24 3/8 .46-c Shamrock Oil & Gas 29 1.60 5.5 36 3/4-b .63 Southern Pacific United Carbon 56 1/4 39 1/4 5.00 2.00 8.8 5.1 70 45 3/4 8.07 3.60 Western Auto Supply 47 1/4 3.00 6.3 90 1/2 5.00 I' a–New rate. b–1948 high. –For 12 months period ended in 1950. c–Earned April 1950 quarter. June 9, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN This memorandum is not to be construed in an offer or sollcitation of offen to buy or lell any securities. From time to time W.!Ihton, Hoffo!In & Goodwin may have an intered In some or all of the securities mentioned herein. The foregoing material has been prepared by. us as a maHor of lnformlltlon only. It Is blled upon information believed reliable but not neceullrily complete, Is not guaranteed as aeeuTlite or finlll, and II not Intended to foredoJe Independent InQuLry. J

Download PDF

Tabell’s Market Letter – June 16, 1950

Tabell’s Market Letter – June 16, 1950

Tabell's Market Letter - June 16, 1950
View Text Version (OCR)

'- .If …. , …….. ..-.-. 'Walston-Hoffman &, Goodwin' SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, , …. LOS ANGELES, CALIF. BAKERSfiElD BEVERLY HILLS EAST ORANGE. H. J. LONG BEACH MODESTO OAKLAND PASADENA SAN DIEGO SAN JOSE SANTA ANA EUREKA FRESNO HAGERSTOWN, MD HARRISBURG, PA. PITTSBURGH, PA. RIVERSIDE SACRAMENTO SEATTLE, WASH. STOCKTON VALLEJO – 1- ' . TABELL'S MARKET LETTER ,, . '–'-'' , ''''—jS'WALL STREET, NEW 'YORK 5, N. Y. Digby 4-4141 HOTEL WALDORFASTORIA PLa, 9-6810 On June 14, 1949 the industrial average reached a low of 160.62, ,On Monday of last week, June 12, 1950, the industrial average reached a ihigh of 229.20. This is an advance of 68.58 points in a year's time. To the ';holders of the better grade investment issues,and a few special situations, .this has been indeed a banner year. Their holdings have in most cases pass ed the 1946 highs and in some cases have even surpassed the 1929 highs. However, to the holder of most secondary and speculative stocks, ;this has been a disappointing bull market so far. As a rough estimate, I iwould say that fulJ;y'two-thirds of the listed issues are selling 25 below itheir 1946 highs even though the industrial average is sixteen pOints above .its 1946 high. Probably one out of every three listed issues is today sell ing at less than half its 1946 highs. ; This situation really is not an unusual technical phenomena . ., Every bull market starts with investment leadership. Gradually, as the jmarket moves higher, confidence returns and the demand seeps over into the ,secondary and speculative issues. The only unusual part of the present attern is the time element. It would appear that after a year of rising ,demand for blue chip issues, there would be at least the start of a drift ,over to the more speculative sections of the list. However, the fact that it has not yet happened is the main reason why the industrial average has been able to advance almost seventy points without a worthwhile interme- ldiate reaction. The technical pattern of the market remains sound. There ;are no signs of speculative excesses. , Unless this bull market 'is going to follow a pattern entirely ; \ ,;different from preceding markets of this type, it would appear that, oefore' ,','the advances top out, the secondary issues will playa more important part. ,I do not believe that a move comparable to the sharp runups of 1946 is iI', !, the offing. This letter has stated for a year that this phase of'the ad- . ,vance would be led by sound dividend paying issues. Nevertheless, the se- ,';condary issues should partiCipate to a much greater degree than heretofore. I draw your attention to last Monday's letter which contains a list of 'issues of this type. The price swings in the averages have been unusually wide over , ,the past two weeks. After reaching a low of 218.66 on June 6th, the indus-, 'trial average rallied back to 229.20 on June 12th, to be followed by a de- I cline to 221.79 on June 15th. The rail average, by comparison,has shown ! better support. The June low of 53.62 was followed by an advance to 57.55 , on June 12th. The low so far has been 55.82, reached on Friday. These 'gyrations resulted in an overbought position on the short term indicator f' ,and a selling signal on Monday. However, the 8.42 point decline has now brought the short term indicator into an oversold position. From the pat- , ,tern, it would seem almost certain that a buying signal will be given some L time Monday on the short term indicator. Would replace all trading posii ,tions that have been liquidated early this week because of the sell signal. !.' ; At no time during the year's advance from the June 1949 lows has! ,'either the long term or intermediate term indicator reached an overbought position. Each rise has been consolidated before ,the'advance assumed climactic proportions. Continue to believe that the market will move to the 250-260 range before a full fledged intermediate correction occurs. June 16, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN Thi, memorandum Is not to be con5trLled as an offer or solicitation of offen to buy or sell any securities From time to time Walston, Hoffman & Goodwin may have an Intetflst In lome or all of the seCUrities mentioned herein. The foregoing material has been prepared by us as a matter of Information only. It is based upon Information beheved rellablo but not neceuarily complete, is not guaranteed as accurate or final, and II not intended to foreclose independent inquiry. ——–.,/.. …..

Download PDF

Tabell’s Market Letter – June 23, 1950

Tabell’s Market Letter – June 23, 1950

Tabell's Market Letter - June 23, 1950
View Text Version (OCR)

—-r – Walston.Hoffman&. Goodwin SAN FRANCISCO, CALIF. NEW YORK, N. Y. PHILADELPHIA, PA. LOS ANGELES, CALIF. BAKERSFIELD BEVERLY HILLS EAST ORANGE, N. J. LONG BEACH MODESTO OAKLAND PASADENA SAN DIEGO SAN JOSE'''- SANlA ANA EUREKA FRESNO HAGERSTOWN. MD. HARRISBURG, PA. PITTSBURGH, PA RIVERSIDE SACRAMENTO – …. ……;lATIlE.wASH.- ..-; STOCKTON VAlEJO – – '''; TABEll'S MARKET lETTER 35 WALL STREET, NEW YORK 5, N. Y. DIgby 4-4141 HOTEL WALDORFASTORIA PlO1B 9MlbO The industrial average continues to move in a wide range. Since the first of the month the market has advanced from a low of 218.66 to a high of 229.20 and then tested the low again this Tuesday at 218.99. At , , this week's lows the market reached an overhL,-apght condition on our short term indicator and gave two distinct buying signals one on Monday which 1 proved to be somewhat premature, and another on Tuesday at 219.92 in the I. averages. From this pOint a very sharp rally ensued and at Friday's high of 225.55 the market had rallied 6.56 points (from the week's low. While this average has not yet reached overbought territory on our short term indicator, it will ,do so on Monday unless a sharp technical correction should occur. This may result in a short term sell signal early next week. However, neither the intermediate term indicator or the long term indicator are in danger of registering a comparable overbought signal as they have i strengthened their position due to last week's decline. Therefore, even I .' if a short term sell signal is given early next week, it would appear that it would result in no more than a consolidating phase and a minor decline. It is entirely possible that we are entering a more dynamic – phase of the advance – a phase that will be the prelude to an eventual distribution area. It takes time for such a distributional area to form and during the formation of such a pattern the market in general, and specific issues in particular, could have sharp price advances. This would be accompanied by much larger volume than hitherto witnessed. From a time element such a period could last from three to six months. I continue of the belief that the highs in the industrial average will be somewhere in the 240-260 area. This opinion is purely conjectural because as yet there are no actual building up of distribution patterns. Before that occurs , it would appear that there must be increased public participation and ad- vances in the secondary and speculative issues. ,i Leadership' this week has shifted somewhat. The soft goods iSsues! i notably department stores and textiles, showed considerable strength. These' . . groups, which have been laggards for the past f.our years, were drawn to ; your attention in our letter of May 5th when we advised the purchase of eight retail store issues. Since then we re-recommended several of these issues and a number of textile stocks. While these issues have advanced , from recommended levels, I still believe that they will move higher and , ; advantage should be taken of all price dips to add to holdings. A group of representative issues is listed below, together with their accumulation areas, upside breakout points and possible price objectives. Approx. Price Allied Stores 38 ; Assoc .Dry Goods 19 ; Best & Company 29 , Burlington Mills 22 City Stores 20 Goodall Sanford .,17 Interstate Dept. 27 Lerner Stores 23 , Lowenstein M. 27 May Dept .Stores 50 r'jercantile Stores 17 Montgomery Ward 57 National Dept. Stores 18 Pac ific Mills 34 Reeves 14 Robbins Mills 24 Wyandotte Worsted 12 1949 1946 Approximate Div. igh Trading Range 3.00 3 3/8 25 37 1.60 36 1/4 12 – 19 2.00 52 1/2 24 30 1.50 29 7/8 14 24 1.20 38 1/4 13 – 21 1.37t 47 3/4 14 19 2.00 50 18 26 1.50 44 1/2 17 26 2.00 43 3/4 21 – 27 3.00 70 36 48 1..00 35 13 – 18 3.00 104 1/4 48 59 1.50 39 14 – 22 3.50 48 28 – 34 1.50 18 11 18 1.00 26 3/4 15 26 1.50 25 3/8 8 13 – New indicated rate. – 1948 high. Possible Indication 50 – 55 29 33 48 28 40 35 – 40 29 36 32 35 34 70 25 75 80 32 42 – 51 '26 34 17 24 ,, I ;' I ,1i .'' , June 23, 1950 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN This memorandum Is not have an Interest in some to or be all construed as an offer or 50ltdtation of of the securities mentioned herein. The offen to bll)' or sell o/Iny securities, From time to time Waldo,n, Hoffman foregOing material lias been prepared by, us as.a matter of Information o&nlyG. oIotdwISi.nbameady upon Information believed reliable but not necessarily complete, Is not guaranteed s accurate or final, lind IS not Intended to foreclose Independent Inquiry,

Download PDF

Tabell’s Market Letter – June 30, 1950

Tabell’s Market Letter – June 30, 1950

Tabell's Market Letter - June 30, 1950
View Text Version (OCR)

-Wolston.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 HAGESTOWN. MD HARRISBURG, PA PASADENA PlnSBURGH, PA. PORTlAND, ORE. SANTA ANA SEATTLE, WASH . STOCKTON' VALLEJO TABEll'S MARKET lETTER 3S WALL STREET. NEW YORK 5. N. Y. Digby 4-4141 HOTEL WALDORF-ASTORIA Under a deluge of selling brought about by the suddeH unexpec-teG Korean crisis, the industrial average toppled to a low of' 206.33 on Tuesday and, after rallying back to 216.99 on Wednesday, again reacted to ,the same low on Thursday. The rail average dropped to 50.66, rallied to 53.84 and then declined to 51.10. The market rally on Friday carried the averages baclc to highs of 211. 96 and 52.52. The c.i.,ility to hold above Tuesday's 10KS and above the strong 205 support level is an encouraging technical indication. The present market is dominated by fears and emotions and flash news happenings rather than values, earnings and ' i vidends. This is liable to continue until the present crisis clarifies. In the long run, the present happenings should result in higher stock prices. Ask yourself the question of I'i'hether you would rather own cash than stocks in the event of a huge in– crease In our national debt and the consequent infl,,lonJ.r- pres cure . Of course, it may take some time for this reasoning to assert itself and under , the stress of fear and hysteria, stock prices might work temporarily lower first. Let us try to divorce emotion from reason and present the techni- cal pattern entirely apart from our fears of what mayor may not happen. When the industrial average penetrated the June double bottom lows of 218.66 and 218.99 and the rails penetrated the 53.62 low of June, the intermediate trend was indicated as down. It then becomes a question of wheter the 229.20 top of June 12th was a bull market high to be followed by a bear market or whether the 229.20 high was just an intermediate term top to be followed by correction, consolidation and new highs. r believe the latter to be the case. The June 12th high had none of the .; 0 -2cteristics of a major top. There was no heavy volume of trading in low-priced speculative issues with widespread public particjpation. The leadership was in higher grade investment issues and even at their tops, thece issues were yielding above 6 in comparison with 2 5/8 on high grade bonds and after paying out less than half their earnings and selling at 'prices well below eight or nine times earnings. There were no undigested 'new offerjngs or large purchases on slim margIn. There were no large distributional tops formed. Compare these conditions with those present at the 1929, 1937 and 1946 tops. If the June 12th high is just an intermediate top to be fOllowed by new highs after an intermediate correction, how low could the intermediate correction carry The industrial average has advanced approximately sixty-nine pOints from the June 1949 low and the rails have advanced eighteen points. A normal intermediate correction usually retraces one-third to -, one-half of the advance. That would mean approximately 206 to 194 in the -, industrials and 52 to 49 in the rails. The first objective has been 8ached 1.n both' averages. How do these objectives check with the technical pattern There is, strong support at 205 in the industrials and so far the average has held above this figure. There is also strong support all the way down from 205 to' 195. Below that is the heavy support at the top of the threeyear accumulation range. There is strong support in the rails at 50-49 and all the way down to 45. What are the downside objectives on the point and figure charts ',';e industrial average has built up no top pattern so no indicz.tion is available. However, top counts on individual issues indicate tbe possibility of moderately lower levelS 1.n some issues. It is harl to translate this into' terms of the industrial average but I would hazard the opinion it is within 205-195 area. The downside indication on the rails is 49-46. What is ' – – -' — , the short term and intermediate term in- dicators The short term indicator is in a sharply oversold condition, the lowest since the 1946 break. The intermediate term indicator has not yet reached an oversold c,onditlon as yet but it is very close to such a condi- tion and is in a position to do so in the next 22 trading days whether the averages do or do not reach new lows. In conclUSion, from a purely unemotion al technicl viewpoint,believe we are in an intermediate term correction of a major upswing. The low may have been reached at 206.33. Further unsettling 'news mieht carry the averages temporarily lower. Favor purchase of issues that would benefit from a semi-war or defence economy. Rails and steels are ou din rou s of this t e. If; h!l m,;'M1(!d;;.t.64rnedduilAdtbmQe to or be alt construed as an offer or solleltatlon of of the securities mentioned herel The offers to buy or sell any foregoing material has been .l m prepared by fl'fb us as a matter ston, Hoffman & Goodwin may of Information only It is bas(1d upon Information believed reliable but not naceullTily complete, Is not fi1uaranteed 5 aCCUfo!lte or final, and 11 not Intended to foreclose Independent inquiry

Download PDF

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