Tabell’s Market Letter – March 13, 1959

, -W–a-l-sltnocn.-&-C–o-. FILE COpy Members New York Stock Exchange NEW YORK SAN FRANCISCC LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND ABROAD TABELL'S MARKET LETTER March 13, 1959 The Dow-Jones Industrial average reached new high territory on Friday at an intra-day high of 618.80. Technical work indicates a possible 625 on this short-term mov , followed by a consolidating period before the advance is resumed. Despite the sharp ad- vance, there are still no signs of any long-term technical vulnerability. Would continue to ignore the various averages and concentrate on the action of individual issues. Below is a review of all of the issues on my recommended list. These recommend tions are for the intermediate term holder whose objective is sizable long-term capital gains of six months to two years. These recommendations are not designed for the short- rerrtftra-der in moves-of a few points. – .. AMERICAN CAN (49) has done little marketwise since its original recommendatio at 42. However, the stock has a sizable long-term upside potential and support close to the market, so there appears to be a minimum of downside risl. Yield is slightly over 4. BUY-HOLD BUTLER BROS. (39) was recently recommended at around present levels. Divi- dend has been increased to 45 quarterly to yield 4.2. Technical pattern suggests a slow rise to the 60 level. BUY-HOLD CHICAGO, MILWAUKEE, ST. PAUL & PACIFIC (28) Recently recommended in the 28-26 range. This rail has very sizable upside potentials because of possible merger developments. Has had wide moves back and forth in the 30-10 range since 1951. Ability to break out of this would give a very constructive technical indication. Stock yields 5 1/2 at present dividend rate of 1.60 annually. Very attractive, in my opinion. BUY-HOLD CL,'ETT PEABODY (55) Recently recommended O An important manufacturer of men's apparel, but also has a et process,Clupak, with an excellent earnings potential. Stock has a ov 8 a share and yield of over 4. Technical pattern suggests s over the longer term. BU.Y- BQLD . . . . .. FAMILY FINANCE (32) The to a a 0 advance from our originally . action may be slow, but can b . desiring income. Yields approximately 50/0. HOLD FLINTK a ecommended at 46, the stock still suggests higher l.L…. ,ie ' . HOLD most of the oils, this stock has shown below-average action since my recommen n at 28. However, a very strong potential base pattern appears to be building up in this stock. Timing is difficult, but patience should be rewarded in this issue. Ability to move above the October high of 30 1/4 would be constructive and indicate considerably higher levels. BUYHOLD GIMBEL BROS. (45) The stock has had a nice rise since our original recommenda tion at 27. Still has a 45-55 potential. HOLD GULF OIL (117) Still selling around our originally recommended level. From a technical point of view, the stock appears to be building a wide potential base in the 100129 range. BUY-HOLD HEINZ, H.J. & CO. (70) Originally recommended at 56, the stock still has a very interesting upside potential. With 80 of earnings from foreign sources, profit margins tligh. BUY-HOLD HERCULES POWDER (61) Has advanced from originally recommended level of 48 but still has a minimum technical objective of 75. HOLD HOFFMAN ELECTRONICS (54) This stock originally entered our list in the 22-2 area. The base formed in that range indicated an objective of 43-52. Later action indi- cated 52-57. At the high of 541/2, these objectives have been achieved. Probably the stock of this well managed company will consolidate in a trading area to form a new patte This may take time so I am dropping it from my recommended list for the time being. Switch into other issues in list. HOOKER CHEMICAL (43) Originally recommended at 35, the stock has an upside potential of 50-60. HOLD ThiS lett.llr IS not, Rnd under llo Circumstances IS to be construed as, an offer to Bell or n solicitatIOn W buy any securities referred to herem The mCol'mation contnlned hcrem IS not guaranteed a!\ to accuracy or completencss and the fut'mshml thereof IS not, and undcr no O!It'cumstances is to be construed as, B representa- iwn lW Wnlstnn & Co, Inc. All cXprcsswns of omnlon al c subJect to ch);lnJ.!'c 'j\.lthout notICe Walston & Co, lnc, and OffIcers, DIrectors, Stockholders llnd Employees therC(lf. purchase, sell and may hll\e an interest In the securities mentIOned herein ThiS market lettcr IS mtcnded Bnd presented merely as a general, mformal commentary on dllY to dny market news and not as n complete analYSIS Additional information With respect to any securities referred to herem wlil be (urfllilhed upon r e q u e s t ' Wr,' JOI fBtE COpy – INTERNA TIONAL MINERALS & CHEMICAL (30) This has been the most disappointing issue in my list. It has done practically nothing pricewise and is selling just a shade above its origmally recommended level. However, its potential base is so wide that I am continuing to recommend the issue. to reach 34 would be extremely constructive technically and indicate much higher levels. BUY-HOLD MAGNAVOX (57) The stock has rallied sharply from the recommended level of 40, but still indicates higher levels. BUY-HOLD MONSANTO CHEMICAL (47) Has moved ahead nicely from the recommended level of 38, but still has a higher technical objective. BUY-HOLD NA TIONAL DISTILLERS (34) This is one of my favorite issues for long-term appre- ciation. It has moved ahead from its originally recommended level of 27, but still has a very sizable upside potential for the longer term. BUY-HOlD NEWPORT NEWS SHIPBUILDING (49) Has done little marketwise since it was recom- 47 has a ve!Y20und favorable longterm pattern. BUY-HOLD — — – – — NORTHROP CORP. (42) One of the more interesting missile-electronic stocks. Has advanced from a 33-31 recommended level, but still has a much higher potential,in my opinion. BUY-HOLD NORTHWEST AIRLINES (41) See my letter of February 27th when this stock was recommended at 38. This is one of the more attractive airline issues and indicates higher levels. Earnings for 1959 should be above 5.00. BUY-HOLD PAN AMERICAN WORLD AIRWAYS (30) This issue has been one of my airline favorites for a long time and was originally recommended at 15. Still indicates higher levels, despite its 1000/0 advance. BUY-HOLD PENNSALT CHEMICAL (89) The stock has risen from a recommended 71, but has a much higher potential. Believe it to be one of the more dynamic issues in the chemical group for long-term holding. BUY- HOLD PHILIP MORRIS (64) Has advanced steadily from a recommended level of 48, but I still advise continued purchase and retention. BUY-HOLD ROHR AIRCRAFT (24) Is still selling at my recommended level of 24. The com- pany's principal product is a power package for jet, prop-jet and propeller aircraft. 600/0 of backlog is commercial. Technically, it has a much higher potential. BUY-HOLD TCH(44) Se-interrfati-onat oils– are selling below the recommended levels of 48 and 22. However, like Gulf Oil, they are building up very sizable potential bases and upside objectives appear to outweigh downside risk, but patience may be required. BUY-HOLD SINGER MFG. (46) Believe this issue is outstandingly attractive. Recommended at 48, it advanced to 54 7/8 and is now below recommended levels. Book value is a stated 81. a share, but is probably considerably higher. BUY-HOLD WILSON & CO. (38) This stock has advanced 1500/0 from my recommended level of 15, but I am still advising its purchase. Management is excellent and earnings should continue to improve. BUY-HOLD LOW-PRICED STOCKS This group was recommended on November 7, 1958 as a package, with the exception of the more recent recommendation of Home Oil A and B – Recommended Price Current Price Remarks Avco Corp. 9 13 Buy-Hold Chemway Curtis Publishing Decca Records Divco Wayne Freuhauf Home Oil A or B Hotel Corp. National Can Pacific Petroleum Publicker Rayonier United Industrial 11 17 15 14 18 19 17 17 — 25 20 19 78 14 13 18 16 11 14 19 25 13 14 Hold Buy-Hold Buy-Hold BUY-I1old – Buy-Hold Buy-Hold Buy-Hold Buy-Hold Buy-Hold Buy-Hold Buy-Hold Buy-Hold .. The upside potentials on all of the issues mentioned in this letter will be found in my Technical Analysis of 1,100 Common Stocks, Copies are available to clients in all Walston & Co. offices, , EDMUND W, T ABELL WALSTON & CO.INC, .-.-