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NEW YORK 5, N. Y. 3S Wall Street OIGSY 014141 PHILADELPHIA 2, PA '420 Walnut Street PENNYPACKER ssm LOS ANGELES 13, CALIF. SAN FRANCISCO 4, CALIF. SSO South Spring Streot 26S Montgomery Street MAOISON '22 SUTTER '2700 , Last vleek the market action gave added evidence to the thought .; that the market is building up a pote;otial top patter!. As yet, the , pattern butional is incomplete and more Hork may be needed to enlarge the distritop. lli th the exceptio', of steels and motors, comparatively ;;/ f-; S (,;1 few issues have formed broad top patterns and continued backing and fill- ',,,;,, ' ',,' 'i.'.i.1is ),' a broad trading ra;1ge bounded roughly by 245-255 action should present very favorable opportunities appears indicat2d. to switch out of 1 issues with unfavorable patterns into those with excellent long term potentials. ',,' ; A few issues of this type are noted below CARRIER CORPORATION was origi;,ally recommended in this letter ,'at an equivalent price of 10-11 for the preset stock. It is presently ' selling at 22 1/4. O the basis of the indicated 25Ji quarterly rate, it , is yielding 4.5. The divide!1d appears conservative 1'i'e compared to earn- .. ings of 4.54 in 1950. The stock has tremendous growth possibilities. ,'It is the leading indeper,dent cOffipany in the air-conditioning field. ' Its products range from self-contained units for individual rooms to – industrial units of 1200 tons. While its 101lg terrl growth potentkl is ,' based on a peace economy, it will do very well under the present defense ' ;' econo;ny. If large air-raid shel'ers or undergroud plants were necessary, the denand for company 's produc s would be tre!1endous. Finances have ' been gradually inproving. Net 1'iorking capital has increased from 4012 ; in 1941 to 18.12 in 1950. This stock has formed a very strong base , pattern in the 12-19 area. The upside ) tration indicates an initi2.1 ',; 23-25, which has been 1' -Jo.ed, to be followed by a eve;tual 45. Would -, buy on all mip..or price c.ips. ! ,; COLUMBIA GAS SYSTEM, at 13 3/8, is an excellent natural gas growth situation in addition to being a good defensive vehicle in the ,-, prese ; o –;10mic uncertainty. The corr,pany is one of' the nation 's ,' , ' large ,stural gas systems. It serves, directly or throgh sales to ; independent distributors, over two and a half milliop.. cu, tomers 0 It , operates in Pennsylvania, OhiO, West Virginia, Maryland and Kentucky. . It serves such populatior; centers as Wasr.ington, Baltimore, Cincinnati, ;', Dayton, Richmond, Columbus, Toledo, and Harrisburg. Income in 1950 in- ,t r ' , creased to 1.18 per share from 84Ji in 1949. Profit for the 12 months ended March 191 improved further to 1.28 a share. And net for the , season211 – ooC. March quarter of 1951 rose to 68Ji vs. 58Ji in the March ,; 1950 quarcer. The dividend was increased to 20Ji quarterly in the first ; c quarter of 1951. With the demand for natural gas increasing, further ; 'earnings expansion is indicated. The company has spent 200 million in ;, expansion over the past five years. The technical pattern is good 0 The f,;' stock has held in the 9-14 range for 3 years 0 An upside pe e';ration ; would indicate an initial objective of 20. The stock may be slol'l but '– it has a very strong potential pattern. Buy on all minor price declines. , ,' ,t LAr-iBERT COMPAl\'Y lias origir,ally placed in my recommended list '' at 22. It is now selling at 25 1/2 and yields 7.8 on the rate indicated ;' by the latest quarterly payment of 50;1. 1950 earnings were 2.94. j,et '; for larch quarter of 1951 rose; to 1.14 vs. 83Ji i;1 the Jllar,,!'\ quarter r', of 1950. Stock has a good tax base. Major produc t is still Listerine , but company has diversified by entering into moulded plastics, etlHcal ,;, drugs and toothpaste and brushes. The stock sold at a high of 68 in ;'; 1946. Technically, it has built up a strong base pattern in the 17-23 ,; range. The upside ;Je!tration indicates an initial 28 followed by a , long term 400 There is no heavy supply of stock until the 40 level is I, reached. f' ,– – . ,, Buy — on — – minor p r i c e d i p s .- -.- — …. – ——–;;;;. ', May 13, 1951 ;,. Closing Averages Ther e- i s good–. — sportat'.5-2 – – …-. —, – 0 EDMUND W, TABELL VJALSTO!', HOFFMAN & GOODWIlJ 7-'- ,, V; Dow-Jones Industrials 250.10 Dow Jones Rails 70 .l'l / Thll memorandum il 1I0t to b. construed III' en off.r or solicltllltion of offer, to bu, or HII any IIcurltl., From 11m. to tim. Wallton, Hoffman I Goodwin mllly ,', hn'. an lnt.rest In som, or ell of the Hcuriti., mentioned herein, Th foregoing material ha, b..n prepared by u, a, a maUar of Information onl,. It Is baHd ;. l. , , upon information belJe…ed relleble but not nl(lIllIrlly complet., i, not ;uII,ant..d a. accurate or final, and I, not intended to for.clos. 1ndependent Inquiry. , lff;'t';,,,'f(t,!7/l..!m!i,!5i!/1rJ3b,,t'I, ,' f.','-..' ,'' ,'.' ' l.'…,,', '','.', r ,!,, jJI'f,'Vj';F(';j;..;'\!L''.-,';', ''''.J. ''