W—-a–l–s-tInocn.–&—-C—o. Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CI-YCAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER July 7, 1961 On a modest increase in volume, the market rallied during the short week to reach an intra-day high of 694.72 on Friday. Both the Industrial average and the Rail average have broken the downtrend lines extending from the May intra-day highs of 714.69 and 149.14. Also, our breadth-of-the-market index has moved higher, although it is still be- low its Spring high. There is overhead supply at 700-715 in the Industrial average that may furnish near-term resistance, but the overhead supply area may not be as important as the 680-670 support area which has held on two downside attacks. If the optimistic projections of Gross National Product made recently by both Sec- retary Dillon and Fortune prove to be correct, the impact on earnings could be very sub- stantial over the next year and should be reflected in higher stock prices in the more basi and cyclical industries. Earnings on the thirty stocks in the Dow-Jones Industrial average have been in a plateau for the past five years, despite the fact that the price has advanced 31 from the 1956 high. Dividends also have followed the same pattern, as noted below -195-6 Earnings 33.34 -195-7 1958 -1959- -1-960 36.08 27.94 34.31 32.30 Dividends 19.63 20.18 18.38 19.58 20.06 Earnings for the first quarter of this year were down sharply to 5.70 as compared with 8.38 in the first quarter of 1960. This brings twelve months earnings for the perio ended March 31st to 29.62. Earnings for the second quarter will be better than the de- pressed figure for the first quarter, but will not equal the 8.38 shown in the second quar ter of 1960 which was the peak for the year. For the demfthe year, the compar- isons should become increasingly favorable, but with the n i f the first half, earn- ings for all of 1961 will probably not be e 8 rned in 1960. On the basis of 29 for the twelve months ended June 3 and Yn an extremely hlgh-ratlO and one that cannot ailiStl background improves sharply. r\\\ df 61, the average is tic .ed 961 is -mamtamed unless Hie busmes However, the chances t i ement in earnings will be shown appear 1962. As noted in h 1 ue .S. News & -world Report, Government spending will be up sharpl of this year and will continue to rise in 1962. In the first six months of s ea ased on a cash budget rather than the regular budget, th Government took in an mated 3 billion more than it spent. During the next six months the Government is e ected to spend 9 billion more than it takes in. Consumer spending should also rise sharply. Family savings increased during the recession of 1960 and debt has been reduced in recent months. Family income is also expected to rise over the coming twelve months and the combination of the two has always produced heavy spending in past recovery periods. Translated into earnings, the strong rise in both Government and consumer spending could mean that the Dow-Jones Industrial average might be earn- ing at the rate of close to 40 for the final quarter of this year, although earnings -for all of 1961 will not be much higher than 1960. The 1962 results should be sharply higher. If profit margins, an unfavorable immediate factor, improve only modestly, the 1962 earn- ings figure could be 40. If increased volume results in higher profit margins, earnings of 45 are possible. If investor confidence continues at its present high level, it is, probable that the averages could sell at twenty times the more conservative figure of 40, or at the 800 level for the Dow-Jones Industrial average. This is about in line with the upper part of our technical projection of 725-825 in this upward phase of the market. The uncertain factor is, of course, possible unfavorable foreign developments with the Berlin crisis coming to a head later in the year. If the favorable pattern develops, I would expect some of the blue chip issues that led the rise in 1949 to 1956 and have been dormant for the past five years, to be the market leaders again. They also have been in an earnings plateau for the past five years. They should be the prime beneficiaries of an over-all increase in earnings. Dow-Jones Ind. 692.73 EDMUND W. TABELL DT 1 A 1 .,,, Vi'trLS'f'ON Ilt CO. mMOO. IS to be eonstrued as, an offer to sell or a sohcitatlOn to buy any '1ecurthes referred to herem The information contained herem IS nol guaranteed as to accuracy or completeness and the furnishIng thereof IS not, and under no circumstances is to be construed as, a representa- tIOn by WnlRton & Co. Inc All e,;presslons or opinion arc subject to chQnge Without notice. Walston & Co, Inc, and Officers, Directors, Stockholders and Employees thereof, purchase, sell and may have nn interest In the secuntles mentioned herem market letter is mtended and presented merely as a genernl. Informal commentary on aay to day market news and not as 0. complete analysis Additional information with respect to any securities referred to herem will be . . . . . . . , .. . . . . . .

, Walston &- Co. Inc, – – – – Membe,'s New Y01'k Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST 10 COAST AND OVER.SEAS TABELL'S MARKET LETTER July 14, 1961 The overhead supply at the 700 -715 area in the Dow-Jones Industrials proved to be at least a temporary barrier to the advance, and after reaching last week's intra-day hig of 698.97, the Industrials drifted downward on restricted volume to reach a low of 682.58 early Friday.The decline was concentrated in the erstwhileglamour stocks. The more ba issues held relatively well. Lack of buying interest rather than selling pressure appeared to be the motivating force behind the downward drift. After a lower opening on Friday, the market reversed the trend and closed up 5.05 points on the day. The intra-day high wa 693.68, and another attempt.to penetr,ate theoverhead resistance at 700-715 appears.to b in the offing. The action of individual'issues continues to be of primary importance. The stocks marked Buy-Hold on our recommended list of June 30th appear attractive For those not interested in income, suggest taking profits in Kennecott (1\5 3/4), recommended at 741/8, and switching into Magma Copper (54 1/2). We are also adding U.S. Plywood (483/4), and Collins & Aikman (43) to the recommended list. COLLINS & AIKMAN CORPORATION Current i'rice Current Llividend Current Yield Long Term Debt 43 1.20 2. 80/0 3,850,000 For most of the years 1959 and 1960, the common stock of Collins & Aikman Corporation held roughly in the 22-30 range. In the early part of this year the stock moved up Common Stock 528, 600 shs. sharply and has reached a 1961 high of 44 7/8. Net Sales, 1961-2 (E) 70,000,000 Despite this sharp advance, the stock has not Net Sales, 1960-61 65,370,000 yet fulfilled of the 22-30 base, Earn. per Sh. 1961-2 (E) 3.50–4.00 which is aroun sMre, nor does it ap- pe r Sh. 1960 -1 2.47 – MarkeLRange..l9.61A4-..U8–23 '0- pear to prospect P. in un lkman tion to near term years– a . su 'er of upholstery and carpets for the automotive industry. Such i ccounted for some 850/0 of sales, but this dependency has dustry now account for es t where sales to the automotive in- i d ,f total billings. A program of expansion and diversification un e en e five years has resulted in the introduction of nu- merous new produ h o y now produces tricot lingerie, apparel fabrics, tufted carpets, decorator r cs specialty yarns. The company has long been a major sup- plier of fabrics for ai t interiors and has been supplying seat covers and carpet for most new jet aircra . Most of Collins' products, it must be noted, are specialty items on which product- ion can be controlled closely and which are not subject to the usual vicissitudes inherent in the textile industry. This, in turn, has brought a good deal of stability to earnings whic was not formerly present. For example, in the years 1951 to 1956, the company earned as much as 5.46 per common share in one year, but incurred a deficit in three of the six years. In 1957, earnings improved to 1. 50 per common share and since then have held in a plateau at 2.27 in 1958, 2.54 in 1959 and 2.47 in 1960. This was, of course, a period in which the textile industry generally was showing wide fluctuations. Stability has, therefore, been achieved,l;mt stability alone does not account for the recent rise in price, and the real growth potential inherent in the changes made at Collins over the past few years is just beginning to become apparent. 1960 earnings were heavily penalized by non-recurring expenses,otherwise they would have shown a reason,ably good improvement over 1959. For the first fiscal quarter of 1961,ended in May,the company earned 74 cents per common share as against 40 cents in the corresponding period. The first quarter of Collins' year is usually the poorest and it would appear that, barring the possibility of an automotIve strike, the company's sales could increase some 100/0 to around ;;70 million and profits could improve to somewhere in the 3.50 to 4.00 range. Further growth from this level could well be achieved. The current dividend payout of ;;1.20 is less than one-third of estimated 1961 earnings — considerably less than has usually been paid. It would seem, therefore, that a dividend increase in the fairly near future is a reasonably likely possibility. The stock is being added to our recommended list for capital appreciation over the medium term. contnined herln IS not unl!Q'ilo cfiE\lmstances IS to be construed as, an offer bl sf1)Jw(!h referred to herem The mformatlOn tt. c'(uracy or completeness Ilnd the furnlshmg thereoHsrU)l;, ana'un'iter no IS to be construed as, a representa- tion by Walston & Co, Inc All expresSIons of opinion nrc subJect to change Without notice Walston & Co., Inc., and Officers, Directors, Stockholders nnd thereof, purchase, sell and may have an Interest In the securities mentIOned herem. ThIS market letter 18 Intended and presented merely as II general, Informal comment.ury on dny to d'ly market news and not ns a complete anab'sls Additional informatIon With respect to nny securities referred to herem Will be . . \\1'301

WalstIoncn. &Co . NEW YORK Members New York Stock Exchange SAN FRANCISCO LOS ANGELES PHILADELPHIA CHJCAGO OFFICES COAST 10 COAST ANti OVERSEAS TABELL'S MARKET LETTER July'21 1961 The market, as measured by the Industrial average, continues to swing back and forth in a relatively narrow trading area. -,'lith the exception of a short period in May and early June when the Dow-Jone! Industrial average moved above 700, the Industrials have held in a narrow trading shelf between roughly 700 and 670 for over three and a half mont s This is a trading range of less than 50/0. ',iThile this is true of the Industrial average com- posed of investmel'lt issues, it does not apply to the market as a whole. Some of the dre boat issues that were pushed up to unwarranted highs have had declines of 30 to 500/0 in the same period of time. The fact that the investment sector has held up so well while the speCUlative-excesses ofihe early months 'of the year were being corrected is a constructi indication. This action highlights the thought that this letter has stressed since April that the market leadership was changing and that the stocks of larger basic companies would the new leaders of the remaining portion of the advance. A breakout of the trading area in which the market has held since April would undoub edly be of some technical significance for the near term. Ability to reach a new high wou indicate a minimum advance to the 725 -750 area. A downside breakout of the trading are would indicate a decline to the 645-635 range which would be an approximately 50 corre t ion of the advance from the October low of 565. Rather than being disturbed at such a development, if it occurs, I would welcome it as a buying opportunity for the purchase of sound, well situated issues. I believe the 680-630 range is a longer term buying area similar to the 600-550 area which we suggested as a buying area in the last half of 1960. The Canadian stock market has also been in an advancing phase since late 1960 and the Toronto Industrial average has had a slightly larger e rise than ours.Also, it has held up relatively well because of the absence of t excesses that existed in some sectors of our markets tr ea. it e Canadian dollar selling at a discount rather than a premium, n ve to purchase raw materials outside of Canada, but sell their product Iin'ifue U ' States, are in a position the relative Canada, – like the United States, also seems t Five Canadian compani ar another Canadian issue Do . i stages of a business recovery. a\M.bn C\!O recommended list and the purchase of & (18 3/8) is now suggested.Listed on the American in assets and 3 . 't 0 f the larger Canadian companies (375 million . The acquisition of Howard Smith Paper Mills and St. Lawrence a on b s pulp and paper to 400/0 of sales with building materials 35 and chemical-pr c ng 25. This diversified company should benefit from the long term growth of ada. Three other Canadian issues on our list are traded on the American Stock Exchange as well as in Canada. They are Facific Petroleum (10 7/8), Consolidated Millin & Smelt ing (24) and Campbell Chibougamau (8). The first company owns substantial oil and gas reserves. In 1960, Pacific Petroleum acquired the Canadian operations of Phillips Petrol eum Co. and Phillips now owns 39 of the common shares. This should strengthen man- agement and the company, though speculative, should be an important factor in Canadian oil and gas. Consolidated Mining & Smelting is one of the largest lead-zinc-silver com- panies in the world. It sold as high as 40 in 1955 and yields 3.8 (subject to 15 non- resident tax). Campbell Chibougamau is a most interesting speculation on the possibil- ity of the company becoming an important copper producer through the development of its Henderson Mine. Gold development could be relatively important. The other two Canadian issues on our recommended list, Dome Mines (23 1/2) and McIntyre Porcupine (34 5/8) are listed on the N. Y. Stock Exchange. McIntyre Porcupine has moved up a bit from its originally recommended level of 27 3/4,but still has consider able appeal. The company mines gold and silver, but also has a large investment portfolio including 700,000 shares of Ventures,Ltd.Market value of the portfolio was equivalent to 35 a share on December 31, 1960. Dome Mines is an interesting speculation on a pos- sible rise in the price of gold. From a technical point of view, the gold stocks have been building up what may turn out to be potential bases. These issues appear to have a very sizable upside potential and not too much downside risk. The main error could be in timing. The two issues noted above are relatively conservative. Some of the lower-priced Canadian issues could have a much wider percentage appreciation. RB, 0 0 UIis to be con;trued an offer to sell f\ so lel on bt tny c c erred to herem. The mCormatlOn toel;QUrDcy or completeness and the furnlshlnJl thercofiiT!A.tJ a o&rdii\(sbmJa\li(lo be construed as, n representn .1…..fi'lfn -ctP.-ihe of opinion nrc subJect to chanJle Without noHCe W'a ston' ,1n'k' Directors, Stockholders and thereof. purchase, sell and may have an Interest in the SecUrltlCS mentIOned herem ThiS market letter IS mtended and presented merely as a general. informal commentary on dny to dny mnrket news and not as a complete anah'sIS AddltJonnlInformatlon With respect to any seCUrIties referred to herem ,ill be \\N 301

—— —- 'fILECOP'f Walston &CO. Inc Membel's New York Stock Exchange , NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CK/CAGO OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER July 28, 1961 In the short space of four trading days, the Dow-Jones Industrial average moved across almost the entire 714-671 area in which the market has held since early May. From Monday's intra-day low of 678.27, the market advanced to an intra-day high of 709.15 on Friday. The average has now held at above the 670 level on three downswings. The Apr 1 low was 671.64, the June low was 673.49, and last week's low was 674.80. From a cal viewpoint, the pattern suggests a strong triple bottom formation and the odds favor an upside penetration of the four-month trading area with a minimum objective of 725-750. Other technical indicators also showed favorable-technica-l action. Volume increased shaq 1; on the advance and the breadth of the market index improved. The breadth index faces an i portant test in the next several weeks. Ability of the index to reach new high territory alor g with the averages would be a very constructive signal. Failure to do so would be a warnin signal of contrary action. This signal is usually given some 6 months or more before the averages actually reach their highs and is an indication of a mature market and increasing selectivity. This week's advance was sparked by President Kennedy's firm stand on Berlin and his request for increased defense spending. He asked for no immediate increase in taxes, but in the background lurked the distinct possibility of excess profits taxes, price controls rationing, etc. , if the situation worsens. No two periods are exactly comparable, but the nearest approach to what might happen in the near future is the Korean War period of June, 1950 through 1952 when all the above taxes and controls were ultimately imposed. Ad- mittedly, conditions are quite different – not only in the general price level, but also in thl fundamental position of individual groups, but it might to compare the grou actionin the above period. The Dow-Jones Industrial avera ad eGlapproximately 500/0 from the June 1950 low of 197 to the 1952 high of 2W n t vU!i&l a 500/0 advance ill the averages on this advance – 20 would be more' L are the percentage advances of-75 Standard &-Poor's group It will be noted that the groups that showed the best relate issues and heavy machinery. – – . '- – e stocks, transportation – Crude 50 Textile Weavers 25 Llfe Insurance 50 Drugs 24 Material Handling -v-JONES IND. 50 Baking 24 Rubber Shipbuilding 49. Dept. Stores 22 Oils – International 96 Automobiles 49 Utility-Electric 22 Fertilizers 96 Machine Tool 48 Banks 21 Aluminum 96 Invest. Cos. (Closed) 48 Publi!hing 21 Oils-Domestic 86 Broadcasting 47 Motion Pictures 20 Rails 84 Machinery-Steam 46 Printing Equipment 18 Mining & Smelting 82 Machinery-Ind. 44 Natural Gas-Dist. 17 Oil Well Equipment 78 Farm Machinery 43 Building Materials 16 Paper – Containers 71 Chemicals 39 Retail-Apparel 14 Air Transport 69 Shipping 38 Sugar Refining 14 Coal 69 Fire Insurance 37 Beet – Sugar 12 Sulphur Copper Metal Fabricating 67 Companies 36 66 c Distillers 36 66 Insurance-Casualty 34 SSohaopess Textile -Apparel 89 8 Steel Alloys 66 Cement 33 Food Packers 7 Paper 65 Railroad Equipment 32 Telephone 7 Gas Pipe Lines 64 Gold Mining 32 Biscuit 6 Lead & Zinc 57 Machinery-Construction 54 Electrical Equipment 54 Foods-Canned Dal'ry Mail Order 32 Tobacco 3 31 Containers-Metal-Glass 2 30 Meat Packing 2 Radio & Television Sugar – Cane 53 Steel 30 Variety Chains 52 FOoffoidceCEhqauinips ment 28 26 Soft Drinks 1 – 20 Dow-Jones Ind. 705.13 DOllr-ToneS Bails 139 06 EDMUND W. TABELL T\iVALS'T'Off & CO. RfC. ThiS mnrket letter is not, and under no circumstances IS to be us, an offer to sell or n sohcltniJon to buy Ilny se-curitIes reierred to herem The mformatlon contnmed hcrcln IS not guaranteed as to accuracy or completeness nnd the furnishIng thereof IS not. nnd under no cIrcumstances IS to be construed as, n repr-cscmtn. lion hy Walston & Co, Inc All expressIOns of OPInIon ate subJect to chnnge WIthout notice. Wnlston & Co, Inc, !lnQ Officers, Directors, Stockholders nnd fmployccA thereof, purchase, Bell nnd mny have an Interest In the sccuntles mentioned herein ThiS mnrket letter IS itJtended and presented merely as n Itenernl, mformnl commentury on day to day market news an9 not as a complete analysis Additional information With respect to any securitIes referred to herein will be .. . . . .Jl