Tabell’s Market Letter – June 09, 1961

FILECO'Y Walston &lJO. Inc Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CIICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 9, 1961 Last week's market was a two-sided affair. Most of the basic issues held steady or even advanced, while the glamour issues continued their decline. Some of these declines have been extremely severe as witness drops in such market exotica as Avnet from a high of 68 1/4 a month ago to a low of 44, a slide in Brunswick Corp. from 74 to 53, a decline in Transitron to 27 1/8 from this year's high of 42 3/8, and last year's high of 60; a drop in Foxboro from 87 to 67, and Perkin & Elmer from 83 1/2 to 57 3/4. Even more drastic declines occurred in some issues over-the– .– counter. The market appears to be undergoing an internal purge with the correction in the overexploited growth issues having little effect on the general market. During the same period, which witnessed the declines noted above, such market wheelhorses as Singer Mfg. advanced from 70 to 102 1/2, Woolworth from 67 to 88 7/8, American Smelting from 56 to 72 1/4, and American Viscose from 45 to 62 3/ 4./The trouble with the growth issues is probably caused by poor buying in recent months. The original concept of buying issues of smaller companies that have had an outstanding growth record over a period of time is a sound one. The original buyers of this type of issue were sophisticated institutional buyers or larger individuals who bought for long-term investment holding and not for trading turns. The entry of the fast buck boys pushed these equities in many cases to unreasonable levels, particularly in some of the lower-priced new issues with little or no past record of earnings. Some of the better issues probably have had about sufficient decline, but it will take a long time to consolidate and, from a technical new bases. These issues probably have seen their highs for a long t etc 8). Some of the less respectable issues will undoubtedly work admonition of Mr. Bernard Baruch who, a long ti a s ' e to heed the 0, d in times of market enthusiasm t to .' — two and two make four, two -and twomak There is no change in 0 r n ist except that we are dropping 1960 at a e a r he three-for-two split this year. Since that time it ha t 0 s ell as the Dow-Jones Industrial average, which has appreciated a i most 100 for McCall. The year's high was 39 1/4. The stock may wor so /; at higher to the 40-43 level, but other issues appear to have better potenti ver the intermediate term. Another stock in our recommended list, American Viscose. (60 7/8) has advanced sharply in the past week. While this issue has reached its initial objective, we still advise holding even though some consolidation may be needed. The long-term potentials indicate higher levels. The development of Avicel, the new food additive, is most interesting. There is always the possibility also of the eventual spinoff of the company's holdings of Monsanto Chemical which has a value of about 39 per share of American Viscose. There are a number of issues in our recommended list that appear to be a bit behin d the market. Included in this group are Anderson Clayton Barber Oil Carpenter Steel General Mills Heyden Newport Kerr McGee Dow-Jone Ind. 700.90 Dow-Jones Rails 143.93 Marquette Cement National Aviation Thompson Ramo Wooldridge Twentieth Century-Fox V.S. Borax V S. Vitamin EDMUND W. TABELL WALSTON & CO.INC. This letter 18 not and under no CIrcumstances IS to be construed as, nn offer to sell or a sohcItatlOn to buy any secunties referred to herem The contained herein IS not as to accuracy or completeness and the furnlshmg thereof lS not, and under no circumstances 15 to be construedsk; d bon by Walston & Co. Inc. Employees thereof purchase All sell expressions of opinion are subject to change Without notl!'e Walsten & Co, Inc, and Officers, Directors, c 0 Bnd may have an mterest in the SecUrltlCS mentiOned herem. ThIS market letter is Intended and presented mereiyhas a geeraniat'nbi, informal commenUuY on day to day market news anI not as a complete analYSIS AddltlOnaJ information with respect to any SecUrities referred to crem Joi . -..– -9