Tabell’s Market Letter – March 26, 1954

Walston &Co. MEMBERS NEW YORK STOCK ExCHANGE AND OTHER LEADING STOCK AND COMMODITY EXCHANGES NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO LUGANO (Sw,Id) OffiCES COAST TO COASi CONNECTE BY DIRECT PRIVATE WIRE sYSTeM TAB ELL'S MARKET LEnER March 26, 1954 BLAW-KNOX COMPANY STATISTICS BACKGROUND Current Market Current Dividend 18 1/2 1. 20 As a producer of thousands of different types of products for Current Yield 6 1/2 the major industries of the country and as an important sup- Capital Stock (shs.) 1,446,755 plier of equipment for atomic ' energy plant construction, Blaw- .Net Per .Share ,1953 –22. 8967— – ..- -Knox-appears -well-fortified to . Net Per Share 1952 meet any dip in military demand Operating a total of 10 plants, Sales 1953 120,067,563 6 in Pittsburgh area and the Sales 1952 99,941,469 rest in N.Y., Ohio and Minnesota, , , and with sales offices in all ma- Market Range (1953-54) – 15 3/8 jor cities, it is a virtual de- partment store for heavy industry. Plus 2 stk. diY. paid 1953 A broad range of fabricated prod- ucts and specialized equipment,as well as engineering and construction services, are supplied to such indus- tries as steel, automotive, chemical, food, paper, cement, metal, petroleum and gas, public utility, and road-building. COMMENT The company started 1954 with a 70 million order backlog. This is below the year-earlier figure but it should be noted that it does not include orders on hand from the Atomic Energy Commission as these are handled on a fee basis. Still to be completed is a 40 million AEC contract, awarded last year, to build the chemical processing plant at Hanford Atomic Works. Additiona1 multi-million dollar contracts have been received from the AEC for its Portsmouth plant and National Reactor Testing Station in Idaho-.It is-s,j,gnificantthata sizable-portronof the-order'backlog- represents contracts for the building and equipping of processing plants in the rapidly-expanding chemical and petrochemica1 industries. Also noteworthy is the fact that the recent acquisition of a road-building machinery company greatly extends the firm's participation in this field, so that it will be in an excellent position to benefit from the anticipated acceleration of public works activity. Sales reached an a11-time high of 120 million last year, and earnings amounted to 2.93 per share based upon the number of shares outstanding before issuance of additional stock for the 2 stock dividend paid in December. Based upon the number of shares presently outstanding, 1953 net was equal to 2.86 per share. While this year's results may be somewhat 10wer, the management looks for maintenance of sales on a high plateau and earnings wi11 be supported by elimination of excess profits taxes, which severely penalized profit in recent years. Considering that the company is a supplier to heavy industry, its earnings have been remarkably stable, having fluctuated between 2-3 during the past nine years. The record of dividend disbursements is good, only 4 years having been missed since incorporation in 1919, and the current rate of 301 quarterly appear iecure, based upon earntngs PfSpets and t company' s 'sfrong financial position. An all-common capitallzalon with no debt urther enhances the appeal of Blaw-Knox common as an lnteresting commit- ment for both income and capital gain. Mr. Tabell is on vacation and the above analysis is from our Research Department. Mr. Tabell's'technical analysis on this issue is as follows BLAW -KNOX (18) BUY Stock formed a very strong base pattern in the 11-20 range. The upside penetration indicates 28-33-followed by a long term 41-46. Buy on any price dips. An outstandingly attractive issue. There is support at 16-14. 1953 high was 23 EDMUND W. TABELL lOIATSTQN BG GO, t Walslo & Co or /lny D!IIllH 'h,,-eo bertThiS mllY mhlelmvoraannd,unmlerne1noItn toombee con\true or /111 a, an ofh. r sohcitatlon of offen to menhoned herein The b ule,un Ie ua I, tomplete 15 not buy or Stll any ,ecurill foregOing qUdr!lnteed muat erial ha, aCcur!lta e' or FrormreptlmTee,d t onb ' t ' ; 0111 cl ,ntendl!d mtoatt'o.reoli',enfo,rnmdeilDtoonndnonllytr,ouIt,tV1 \ Ina, an I b.,ed upon 1Ilformdilon believed rei'!Ib I! U no neel! rI ,