Viewing Month: June 1964

Tabell’s Market Letter – June 05, 1964

Tabell’s Market Letter – June 05, 1964

Tabell's Market Letter - June 05, 1964
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— Walston &- Co. Inc Member. Sell' York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 5, 1964 The first four days of last week saw the Dow-Jones Industrial Average, along with most individual stocks, decline sharply. Thursday's low was 800.76, close to our downside obJective of 795-785. In an uncertain market of thiS nature, holdings should combine a minimum of down- side risk with good long range upside potential. American Can Company is therefore being added to our Recommended List for quality and long term growtn. AMERICAN CAN COMPANY Current Price Current Dividend 44 i ng -atAi'm7 erican times Can, last y currently at 44, is sellear's earnings -of 2.56 Current Yield 4.50/0 to yield 4 1/20/0 on the 2.00 dividend. A simi- 1ar statement could have been made at almost Long Term Debt 227, 685,000 any time during the past 10 years. With short 1.75 Pfd. Stock 1,661, 502 shs. periods of exception, the price range since Common Stock 16,112,107 shs. 1954 has been 40-50 and earnings have held between 3.04 peak and 2.06. The 2.00 Sales 1963 1,149,400,000 Earned per share 1963 2.56 payout has been a fixture since 1956. Although this is hardly the picture of a growth Market Range 1964-62 47 3/8-38 1/8 stock, there have been profound changes takin place during the past decade which have not been statement. American Can is no longer purely a tin can maker, r zor-thin profit margins brought about by intense competition. It 0)1 a' sified .company spanning the entire packaging field with strong inancial abilities auguring well for growth outside the Paper have been acquired. In 1960 n nte 956 Dixie Cup and Marathon the glass container field. In 1962 v it' presentatioh-in-thechemYcai'and — metallurgical fields and New Jersey electroplat g co e i acquisition of Hanson Van Winkle, a 17 million. It has been a leader in new product development th e aging area. It is certain e why all this has not been reflected in results. The answer is that gro ntroduced packages is slow but steady. The metal beer can, for example. to ears from the date of its introduction to achieve the commandin share of the market' ow holds. Many recent American Can introductions may be in the early stage of similar growth patterns. For example, soft drink cans increased their sale by 28 over 1962. Their total market share should double by 1967. That American Can intends to remain in the forefront of packaging technology is evident by its recent formation of a corporate planning and development department with an executive vice-president in charge. This department is now building its own research and development center. An example,of American's technological leadership is the metal-blowing process, licensed by American from llikon Corporation. Capable of forming seamless aluminum co tainers of any type by forcing gas bubbles through a bath of molten metal, the process has recently passed from the experimental to the pilot production stage and will be applied to other materials, including plastic. It could well revolutionize the entire can-making field by affording significant economies over the present highly complex process. From a technical pOint of view, if the narrow range in which the stock has long held is considered a base, the ultimate upside potential could be well above current levels. It is felt that continued development and expansion will produce the earnings to justify such levels over the long term, and the stock is recommended for income and long-term growth. Dow-Jones Industrials 806.03 Dow-Jones Rails 202.50 ANTHONY W. TABELL WALSTON & CO., INC. ThiS mnrket letter IS not. and under no circumstances IS to be conbtrncd as. fin otter 10 sell 01 R bolicltntlUn til lIuy any 1efCl1 c(llt) hCH!1n The mformntion ('onlnined herem is not guaranteed as to accuracy or ('ompletencso; and the fill fllShlnJ! thereof HI not. nnd undel no el' lumtnnLe., IS to be ns, a rCll! ecntn- han by Waiston & Co, Inc All expression! of OpinIon are to chnnJ.!(.' \\lthuut nutlce & Co, Ipc. and Offlcel Dllcc\nls, and thereof, purchase, sell and may have an Interest IJI the !eC\lrltles hClcln market lett(.'1 1ntende.1 merely a informnl commentary on day to day market news and not as a complete AddLtwnal Inf01 mation \\lth to I1ny lefellcd to heicin WIll be fllrrnshed upon reQuest \\;.. 31)1

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Tabell’s Market Letter – June 12, 1964

Tabell’s Market Letter – June 12, 1964

Tabell's Market Letter - June 12, 1964
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Walston &Co. Inc. Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 12, 1964 The general market pattern has reached an interesting stage of technical develop- ment. Its decline early this week brought the Dow-Jones Industrial Average down to an intra.-day low of 796.90. This is quite close to our 795-785 downside objective. It is also approximately a one-third correction of the 125 point advance from the Kennedy assas sination low of 710.83. Normal technical corrections usually retrace one-third to one-half of the preceding advance. The market's technical action over the nextifew weeks will be important. There is heavy overhead supply in roughly the 810-830 area where the market has held since mid- March. The;rndustrial Average now also has a downtrend line connecting the May and early June highs of 836.06 and 824.94. This line now stands at around the 820 .A rally into the overhead supply and an ultimate failure-to bring in – new buying power would result in the broadening of the top pattern and a lower downside potential. Most objectives in the averages have been reached on both the upside and the downside, and time will be needed to form a new technical pattern. The clue as to the direction of the next move should be indicated by breadth action. Our breadth index turned unfavorable last month and there has, as yet, been no change. The market pattern of the averages is of interest from a background viewpoint, but the price action of individual issues is of much more importance. Because of the uncertai technical position of the market, this letter has advocated some profit taking in individual issues over the past few months and the building up of a 25 cash reserve in order to take advantage of possible buying opportunities. However, we continue to suggest individual issues where the downside risk appears relatively potential appears substantial. appreciation 0 Reynolds Tobacco ( 46) is a case in ct our recommended list early in January before the release of the U. S. a eport. It moved up fro a 1964 low of 38 1/8 to a high of 51 1/2 ent! cf ack to around the 42 level. We believe this stock hils had a sufficient t I co ction and is in a long-term buying -. – -the 1-962-lowas 341/2. Earnings for the 12 months ended March 30 e at 45, the stock yields 4'l on the 1.80 annual dividend. American b 3 a somewhat similar pattern but with a higher yield of 4. 9. Of a more . u s Copper Range (30). This issue was dropped from our recommended' etched its technical upside potential at 39 in April. It has declined sharply sinc th a drop to 27. Would consider the stock in a buying area in the 28-25 range, and t ock will be re-admitted to the list if that level is reached. Beaunit Corp. ( 34 ) has been part of our recommended list for quite some time an continues to show relatively good action. Earnirtgs for the fiscal year ended March 30, we 2. 66 and the stock yields 3.6 on the 30 quarterly dividend. Beaunit was strong during the past week on remors of a possible merger. These rumors have been denied. The stoc has an attractive long-term technical pattern and should be bought on moderate price de- clines. The retail ,store group has been showing above-average relative strength in recent markets. Three issues on our recommended list fall into this broad category. Two of these have reached new high territory recently. J. C. Penney ( 54) which has been on the list for a long time as a quality issue with long-term growth potential, reached a 1964 high of 55 3/8 on Thursday. The 1-961 high was 59. (Vornado ( 27) a comparative new- comer to the list reached a new 1964 high at 28 last week. The 1961 high was 45. Both of these issues should be held and bought on minor declines. The third issue, E. J. Korvette (30 ) 'has not shown as favorable price action. For those in a position to assume a specu- lative risk, the stock appears to be in a buying range at around current levels. The stock has had some rather wide price swings since reaching a 1962 high of 57 and a low of 22 later in the year. Since then, the stock has ranged between 25 and 40. The issue is selling at a relatively high earnings multiple, but 39-weeks net was 1. 18 vs. 1.03. The stock pays no dividend. Technically a large base appears to be forming and the issue has specu- lative appeal in our opinion. EDMUND W. TABELL Dow-Jones Industrials 809.39 WALSTON & CO., INC. Dow-Jones Rails 203.74 ThIll mnl kf!t letter not and under no Clrcumstunces IS to be construed lS. an offer to scll or II. sohcltatlOn to buy any sccurltil!8 referred to herein The informnbon l'ont\(incd herem IS not as to nccurnc' or completeness and the furnishing thereof 15 not, and undel no Circumstances IS to be construed as, a representa- tllln by \'nlston & Employees thereor, Co, Inc. pUlchnse. All sell expressions of opIniOn ure subject to ('hunge Without notice Walston & and may have an mterest 10 the securItIes mentIOned herein. This market Co. letter Inc.. and IS Intende dO fafnI cde rps ,r eDg ei rnetcetdo rms ,e rSetloyc ka sh o'!l' dgeer sn ear na ld, H1formnl comm..ntnry on dny to day market news and not as a complete analYSIS AddltlOnnl information With respect to any securities referred to herein Will be furnished upon request N J01

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Tabell’s Market Letter – June 19, 1964

Tabell’s Market Letter – June 19, 1964

Tabell's Market Letter - June 19, 1964
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Walston &Co. Inc —– Members New YOTk Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFfiCES Co,a.Sl TO COASl 'ND OVEaSEAS TABELL'S MARKET LEnER June 19, 1964 COPPERWELD STEEL COMPANY Current Price 50 Recent developments make a second Current Dividend 2.00 lodlt' at Copperweld Steel Company, first Current Yield 4.0 recommended in this letter in January, wort while. For the first quarter of 1964 the Long Term Debt 17,556,000 company reported a 16. 7/0 increase in sales Common Stock 1,191,737 shs. to almost 30,000,000 and net earnings of 1. 20 vs. .72 or a two-thirds increase. Sales 1964-E 112,000, OOO.-,c-Second quarterLl'esults should be'equally im- sales 1963 – —'- 101,434,502 pressive, and order backlog for the normally low third quarter continues high. It is now Earnings per Sh. 1964-E 4.75 possible to estimate 1964 earnings of around Earnings per Sh. 1963 3.08 4.75 vs. 3.08 in 1963. This will constitute the second best year Market Range 1964-59 55-263/4 in the company's history, surpassed only by 1959, the year of the steel strike. During that year, in the non-strike months, D. S. steel production was considerably above current levels, and Copperweld, moreover, benefited by bel ng among the companies not struck. Thus, the company's improvement program, under which some 9 million of capital expenditures have been made in the past two years, has evidently been highly successful. At less than 11 times anticipated 1964 earnings, C d be attractive in its own right, but it now appears obvious that i pow ill increase sub- stantially in the years ahead. The reason for this 1 ase c e found in three areas of the company's operations. 1. Alumoweld – Sales of this aluminu – ted I wire con1inue to be gratifying, a1yd now amountto some-5'oItlie -tal- ume.-production has increase-dfrom 7 million pounds in 1961 to ais; pounds in 1964, and capacity.is presently available to expand 0 i The product is gaining increased acceptance in variou e t n ssion applications, especially as overhead ground wire, and future e bright. 2. Continuou tin e company's Aristoloy Steel Division is 'currently installing a continuou ca g with 300,000 tons of ammmi capacity. Since this is less than half of A oloy's total capacity, it is expected that the new equipment will be used full time. Various estimates have been made in the trade as to possible savings from continuous casting, but a conservative estimate of the savings Copperweld might enjoy from this facility would be 10 a ton or 3,000,000 annually. After taxes, this would amount to approximately 1.25 per share of common stock ap.d a 15 per ton saving would amount to 1.88. The equipment is expected to be operational by the latter half of 1965. 3. New Copperweld Equipment – The company is now testing in a pilot plant new cost reduction equipment for the manufacture of its staple product, Copperweld, or copper coated steel wire. Eventual conversion of Copperweld production to this equipment will take place as volume increases warrant. Due to increased yield, savi ngs of as much as 20 appear possible on a product with better 20,000,000 annual sales. Thus, per- shire savings' as the new equipment is i'n;talled, -could be as much as 1.75 per common share. In summary, then, Copperweld probably has at the moment an annual eam ing capa- city in the 2.51) -5.00 range, depending on over-all steel demand. To this can be added an increment of 3.00-4.00 from the three factors mentioned above. Within the next three to four years, therefore, the basic earning power of the company could be 5.50- 9.00, depending on over-all steel demand. Earnings of this magnitude could well justify the technical upside potential wh ich is in the 80 – 90 range. The stock is again recommende for inclusion in capitaJ gains accounts. Dow-Jones Industrials 825.25 Dow-Jones Rails 206.82 ANTHONY W. TABELL WALSTON & CO, INC. 1 hi lllrh(j htt.er aut. und Ilndel no c'rcumstance5 IS to he aq, fin offer to Sl'U or n 501l(llatlo')n to hu' any S(!Cuntl(1 referrl'd to h!rem The miormntJon 'ont,llned hel em 15 n,'l U to ar..cnrnc… ,lr compll'hne;g lnd 1hc tl11'lcof 15 not. and under nv I'lrC\1I11tar1('el to be construed AI, It TI'prcsenta. 11JIl hv \\-nlHlon &. Co, Inc \lJ of lire \lhJcel to challJ1c WIthout notice 'alston & Co, Inc, and Officers, Directors, and i-mp1,;'('t.'s th('rrof, )lmchasp, sell linn PH.) have U'l 1Il1.1r……llll the mentlUnt'd h('rein ThIS market letter IS mtended and presented merel as a ItcnNui, mfornml commn\ary N' ,tIl to da 1Trkct new\ and not as 8 complete a1mh-!IIs AddItional mformatlon 'llh l(',pect to any securlb('s rderted to herein fIn rllh('.\ upon rNlllest

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Tabell’s Market Letter – June 26, 1964

Tabell’s Market Letter – June 26, 1964

Tabell's Market Letter - June 26, 1964
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Walston &Co ….. Inc….. Member.. New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 26, 1964 All three Dow-Jones averages were quite strong during the past week with the Rail average reaching a newall-time intra-day high at 213.49. The long term potential of the Rail average is, in our opinion, still considerably above present levels despite the sharp advance that has already taken place. We continue to advocate adding to rail holdings during periods of market irregularity. The Utility average reached a new 1964 high at 144. 52,but is still below the 145.21 peak reached in September, 1963. The Utility average has been in a trading shelf between roughly 145 and 135 since May of 1963, or almost fourteen months. The Utility average is selling only slightly above the 1961 high, but both earnings and divi- dends have advanced over 200/0 since that time. The technical pattern of individual utility issues suggests that the group is in the process of forming a broad base that will ultimately result in higher price levels. Whether or not this accumulation pattern is complete is, of course, not yet certain, but the group offers considerable long term attraction. The Industrial average has rallied back toward the area of the May intra-day high of 836.06. This week's high was 833.05. Actually, the industrials have shown little price action since March. Dividing the Industrial average by ten in order to bring it more in line with the actual price of the thirty components, would result in a price range since the be- ginning of March of 83 5/8 high and 79 5/8 low on an intra-day basis. Before a wide move in either direction is indicated, a broader pattern must be formed. Prior to the early June de- cline to 796.90, the downside potential was 795-785, and the upper part of this range was bout reached. This decline also resulted in about the correction of the 125-point advance from the Kennedy assassination low of eMay high of 836.06. The current advance has broadened the pattern u t e 1S 11 no indication of major move in either direction. The technical pat gs ssible upside potential f 840-850, and a possible downside potential of 785-7(1t0'.;\U w appear probable that the ndustrial average will continue in this fo)th reseeable future. One unfavorable factor at the n of the breadth index. Market breadth indicators are' not of In p;st, hav given warning signals of a the trend itself was reversed. In 1961, for instance, our breadt .nS)e a rning signal as early as August 1961 or eight months before the a tu e a . This gave plenty of time to sell individual securi- ties on strength as a d 1r upside objectives. In the present pattern, the breadth indices gave an unfavo al in late October when the average failed to confirm the 767.24 high in the Indust average. After the November break to 710.83, the breadth in- dices reversed the wa mg signal in early January and moved ahead with the averages in the Johnson Confidence Boom. Another divergence occurred early in May when the breadt indices failed to confirm the 836.06 high. The breadth indices are still below the high reach- ed in April. This indicates a policy of lightening accounts on strength and building up a 250/0- or-so buying reserve in anticipation of a correction before an advance to much higher levels in the late 1960's. There continues to be a sizable number of issues with favorable long term fundamental and technical patterns. One such issue is Swingline, Inc. (34 7/8). It has done little marketwise since it entered our recommended list last August. It is a leading manufacturer of staplers and staples. The wholly-owned subsidiary, Wilson-Jones, is the largest producer and distributor of commercial stationery and office record keeping 'materials. Despite a five-week strike 'n two Wilson-Jones plants early in 1964, earnings for the fiscal year ending August '31st are expected to reach a new high of around 2.65 a share as compared to 2.41 a share in 19621963. Last week the quarterly dividend was raised from 27 1/2 quarterly to 30 quarterly. The stock sold as high as 54 1/2 in 1961 and as low as 22 1/8 in the 1962 break. The stock ppears reasonably priced at about 13.2 times estimated earnings. Dow-Jones Ind. 830.99 Dow-Jones Rails 212.25 EDMUND W. TABELL WALSTON & CO. INC. 1 IS not, and no circumstances IS to be aI;, an offer to sell or Il solicitation to buy any lIeCUrities referred to herem The mformatlOn ('ntalned herem nnt !'unranteed as to accuracy or completeness and the fUrnl;hlll!' thereof I not, !lnd undCI no circumstances 19 to be construed as, a representa- (Hill hy \Vnlston &. Co, In( All eXll1'CSSlons of opmion are sub)cet to change Without Walston & Co, Inc, and Officers, Dlreetore. Stockholders and thereof. sell lInd may ha\c an mtcrest In the mentlOned.hereln ThiS market letter IS lntended and presented merely as a general, Informal ('(,mmontary on da) to da) market news and not as a complete analySIS AdditIOnal mformatlOn With respect to any secunt1es referred to herem will be

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