Tabell’s Market Letter – November 02, 1951
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—- — -/1 , ' ' ,, ,' NEW YORK 5, N Y 35 Wall Street DIGBY 44141 PHILADELPHIA 2, PA 1420 Walnut Street PENNYPACKER S 5917 LOS ANGELES 13, CALIF 550 South Spring Street MADISON '22 SAN FRANCISCO 4, CALIF, 265 Montgo,ery Street sunER 1'2700 TABELL'S MARKET LETTER , I, – ,' l ,, ,- ,. ..' I', '' As expected, the market continues to hold in a trading area bounded ',– roughly by 267 and 256 in the Dow-Jones industrial average. The October ;;; r 22nd low of 259.46 was followed the October 30th low of 256.39. by a This rally to 266.79 and then a decline to week's rally carried back to 265.82 r;,, on Thursday where it temporarily entered overbought terri tory. The average ;' declined again to 261.01 on Friday. In my opinion, it is necessary for the market to undergo a further ,f consolidating movement in the 255-269 area in order to form a new technical,'; pattern. When this formation is completed, a clearer indication of the I; – near term trend of the market will be given. The direction of the next move'.—', is as yet uncertain. However, the weight of technical evidence at hand leans toward the side of lower prices. Would continue to maintain 75 rI,;,'' liquidity in intermediate term capital appreciation accounts. 'I,I,'', Since April, when most issues in the group reached their highs for ;,; the year, the airlines have done little marketwise. As older readers know, ,, this letter originally recommended the airlines in November, 1949. Since ,',,, that time they have advanced sharply in price. What is the outlook for the ' group now I,, I stated earlier in the year that the airlines would be one of the , few groups whose earnings would probably be substantially above 1950. It ;., now appears that many of the airline companies will show record earnings ;; for 1951 and the present outlook is that 1952 earnings will be even higher .' , – This, coupled with the favorable long term technical patterns, indicates ; that the selected airline stocks should continue to be held and purchased ,,; during periods of market weakness. In my opinion, at the April highs, the f airlines completed only about 50 of the indicated long term advance from ,; the 1949 lows. There is no indication of an immediate move and the airlines;-t might even work moderately lower in a general market decline. However, there; is good support not too far below present levels and the group appears to L,; be in good defens i ve position. r, Listed below is the list I originally recommended on November 25, -;; 1949, together with other pertinent data. It will be noted that most of I these issues are selling substantially below 1945-1946 highs Last , Sale 1 ' Alaska Airlines 7 1/2 Amer.Airlines,3 pfd. 84 1/4 American Airlines 14 7/8 Braniff Airways 13 Capital Airlines Eastern Air1ines 13 23 71//88 ' Northwest Air.pfd. 20 3/8 Northwest Airlines 12 1/2 Pan American Air 10 1/8 United Air.4 pfd. 118 3/8 United Airlines 27 1/2 Western Airlines 12 7/8 Price 11/25/49 4 3/4 65 1/4 9 1/8 8 1/4 8 1/4, 14 1/4 17 5/8 9 7/8 8 1/4 81 13 1/2 7 High 1951 10 5/8 88 16 7/8 16 17 1/4 26 1/4 24 1/4 15 3/4 13 1/8 131 31 16 High 1945-46 16 1/2 98 19 7/8 37 1/2 49 3/4 33 1/2 27 1/4 -A 63 1/2 29 120 7/8 62 1/2 40 1/2 , .'., L II' (c.. ,, ,; t, , '-.' I f'; I'; I .- . A 1948 High Believe American Airlines, Eastern Airlines, Northwest Airlines, pfd .i United Airlines and Western Airlines are the most attractive issues in the list and should be held and purchased on minor price dips. The long ,,/,,/ c Hterm price objectives on all these issues are considerably above present i', I' levels and this group offers excellent possibilities for further capital appreciation. '' , November 2, 1951 Dow-Jones Ind. 261.94 ', Dow-Jones Rails 79. 83 EDMUND W TABELL WALSTON, HOFFMAN & GOODWIN ,;,'', .- –,——–,—,———–,—-c– / Thi, mllmorllndum i5 not to b. condrued III an off..r or IOlidtafion of off,,. to buy or sell IIn'l' securitiu From time to time Walston, Hoffman &- Goodwin may h.we an interest in some or all of the s.curllles mentIoned hereIn The fore;olng matenal has been prepared by us a a maer of In'ormatlon only, It i, bued upon informatIon beneved reUable but not neceuartly complete, is not u/lrantud al accurate or fInal, and i1 not Infended to foreclose independent inquiry, ,'i, ;', ,-',' /- – , ;,' ,- '; — '-' ;,';;' -.,.' -,''' rt– O-f ' '-','; – -',;.' -' ,, -' -, ';;-r.,, '' ' 7r-;.'-..'' .- ' ''-,',,,.;;-f.,,-'-.,';.''