Tabell’s Market Letter – August 23, 1963

Walston &Co. MellI/ .Yell' YO'k Stork Erchanlle NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO CO…. ST AND OVERSEAS TABELL'S MARKET.UTTEa .. August 23, 1963 Market action continues on the favorable side. After six successive advancing days with volume exceeding four million shares, the Dow-Jones Industrials reached an intra-day high of 723.57 on Monday. The three-day sell-off was quite mild with the Industrials reach- ing an intra-day low of 713.49 and volume dropping below the four million share mark. The advance was resumed on Thursday and Friday, with the Industrial average reaching a new high for the present move at 726.02, and the Rail average at 176.76, approaching the June high of 177.92. Our short term breadth index has improved sharply in the past week. Despite the mid-week sell-off in the averages, advancing stocks exceeded declining stocks on every day except Wednesday when declines exceeded-a'dvarices15y me rela'tively 47B. As a result, the short term breadth index is now showing better action than the Indus- trial average and has moved above its June high despite the fact that the Industrials are still below their comparable high of 732.97. This would indicate an advance in the average to at least the June high. Two stocks in our recommended list would seem especially attractive for purchase in risk accounts at this time. One, selling at a conservative multiple of estimated 1963 earn- ings. appears to have a growth potential as yet unrealized by the market. The other, an ob- vious growth stock, is hardly cheap on an earnings basis, but still appears worthy of consider ation based on its superb past record and equally bright future. CLARK EQUIPMENT (40 5/ B) was originally suggested earlier this month at a price around current levels. The company is a leader in the trucks, including fork-lift trucks, straddle carriers, towing tractors and po r trucks. It also is a major seller of construction machinery and a 5\0 i enz ystems of freight handling. Po Containerization, in all its aspects, field. Clark Equipment's interest in this fiel s t -fo roads into the transportation ts trailer division is important – u .Js the.fa.ct .th!t .containerized freight . for loading and unloading. For these applications, Clark has the br i av\&tole from any single source. , All of Clark's contributed to a performance which has moved earnings to recor v r the first half were 1. 50 per share, and for the twelve months ende' ne, 1 per share. With backlog continuing high, it would seem ,that the company coul co lose to equalling this performance for the full year. This would mean the secon nsecutive new high in annual earnings. The dividend, recently raised to a 1. 40 annual rate, provides a 3 1/2 yield, but is still conservative in relation to past payout ratios. CENCO INSTRUMENTS (51 1/2) reached a high of 52 on Friday, although it was recommended earlier this month at 43 7/B. Despite the advance, the company's record and prospects combine to make it attractive at current levels. Earnings have increased in every year since 1953 and have multiplied some seven times in that period, reaching record levels of 1. 73 per share in the year ended April 30. The need for laboratory and experimental equipment by educational institutions is too obvious to require detailing here. Cenco is the leading distributor and manufacturer of such equipment for education and for industry. Some two years ago the company entered the hospital supply business with tHe ac – quisition of Mills Hospital Supply Company, and recently has acquired two other companies in the field. It is the company's intention to e x p a nd aggressively in this area. The most recent acquisition is that of a group of three companies manufacturing and distributing freeze-dry equipment. New applications for this process, which involves pre- servation for long periods of time without physical alteration, are developing rapidly, es- pecially in the medical field, and the acquisition should supplement Cenco's rapidly growing sales to hospital and medical institutions. From a technical point of view, the stock has a long term objective well above present levels. Dow-Jones Ind. 723. 14 Dow-Jones Rails -175.81' ;;,. .'1… '- EDMUND W. TABELL WALSTON & CO. INC. Thl'! l('ttci not. nnd unlCi llo to he eon..,tll1('t! 1111 off!'1 tn ..,'II I .1 tn hlJ lillY 'C'1I1111(''I Icfellc,ll hel Cln The InrIIll.,''''') u,tlt.llll('d herCIII)b nt !!'u.lluntccd n tu IICClllflCY UI IInrl the 1\lIllhh,llJ! illl'ICr nut, lind lIll,I!.'. l'n Ib til hc .1 ICI'I c-.ent.l- 11/\ h Wnlston & Co, 1m All e(pr('HUnl of 0llllllllll niL' '!uilJc('t tn .hnllt'c \\Ithput lIt1(' Wnl-.tn &. en Inc 11n,1 lHTI('cl …. DIICI'IOlb. 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