Viewing Month: October 1964

Tabell’s Market Letter – October 02, 1964

Tabell’s Market Letter – October 02, 1964

Tabell's Market Letter - October 02, 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 October 2, 1964 ELECTRlBfl'STORAGE BATTERY COMPANY Current Price 42 The Electric Storage Battery Company is, Current Dividend 1. 60 as its name implies, a producer of a diversified Current Yield 3.8 line of batteries ranging from flashlight dry cells Long Term Debt Common Stock 9,375,000 2,501,547 shs. to automotive batteries to heavy industrial batteries, and expensive specialized units for use in the missile and space program. It is, however, fond Sales – 1964-E 182, and other Sales – 1963 168,500.000 – – literature as a packaged power producer. To Earn. Per Sh. 1964-E Earn. Per Sh.1963 3.50 2.91 many, this term will seem a euphemism, but it is, perhaps, more descriptive of what the company does and, more importantly, of future areas Mkt. Range – 1964-63 441/8-333/8 of growth than the familiar battery. We tend to think of batteries as things that power flashlights and automobiles, and these, indeed, are prevalent current uses. Yet, in another sense, a battery is, indeed, portable power, the means of producing electricity from a continuous re- action taking place in a relatively confined space. A moment's thought will reveal many possible future uses for such packaged power once the technological problems involved can be solved. Missiles and satellites, of course, are one such Storage Battery develops and manufactures a silver-zinc battery for many ace e icPes. The fuel ceil, which is able to produce a continuous electric of promise and the company's research in this field is f , is a familiar area – ens e. ne of the most interestin areas of development involves lightweight sources for portable hand tools, thus freeing rec eab ells to be used as power e er r he tyranny of the electric outlet – a – nt-e-r–ed-a-rQund h-ighly-expensive nickel-cadmium batteries. which could bring the cost of b e on an inexpensive conventional cell, down sharply. All of this ;miSs C t d the fact that a major portion of ESB's earnings come from the mo monplace battery applications. The intensive research on new and exciting ts, ever, does add attraction to a company which has demon- strated eminently satis ct progress over recent years and which is statistically cheap on both an earnings an ance sheet basis. Automotive batteries now account for some one-third of estimated sales with 30 each coming from the Ray-O-Vac division, and from industrial (including missile) batteries. Foreign business, growing at a faster rate than domestic, contributes an important part of the total. Of automotive battery sales, some 75 serve the replacement market, an interest ing statistic in light of the substantial number of automobiles sold over the past three years. Ray-O-Vac's sales tend to move in line with consumer disposable income. Earnings have, as noted, shown satisfactory progress, advancing from 1. 59 in 1958 to 2.91 last year, with an increase shown in all but one of the intervening years. First-half results were 24 ahead of 1963, and for the full year earnings could reach close to 3.50, thus placing a modest 12-13 multiple on estimated 1964 earnings. The 1. 60 dividend provides a 3.8 yield. Book value as of the end of 1963 was 36.00 per share, including net current assets of better than 25 per share. In the light of this record, the stock appears attractive on a long term basis, and it is being added to our recommended list. From a technical point of view the stock has strong support just under 40, and an initial objective of 60 followed by possible higher levels. It is quite possible that new products now in the development stage could provide an increasing impetus to earnings growth which would justify such prices. Dow-Jones Ind. 872. 65 Dow-Jones Rails 218.10 ANTHONY W. TABELL WALSTON & CO. INC. Thlh mArket lett.cr IS not. and under no CU'cumstnnces IS to be con'ltrued as, an offer to sell or n soilcltnhon to huy any securities referred to herein The mformatlOn ('Hlltluncd herem is nnt I!uarllnteed flS to nC('\lracy or compi('tcness and the furnlshJnR thereof IS not, !lnd undel 1111 circumstances IS to be construed as, a representa- hon b) \\'alston & Co. Inc All expressions of oPinJon are subject to chnnl!(! Without notice Walston & Co. Inc, and Offlcerll, Directors, Stockholders and hmployecs therCQr, purchast, sell lind may have nn mterest In the seCUrities ThiS market letter IS mtended and presented merely as a general, Informal ('ommntnry on day to dny market news and not as a complete AddltlOnnl morma11On With to any secuntJes rderrcd to herein Will be fm nJ;hed upon request. ,\ N JOl …

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Tabell’s Market Letter – October 09, 1964

Tabell’s Market Letter – October 09, 1964

Tabell's Market Letter - October 09, 1964
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Walston &Co. Members New York Stock ExcluLnge NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER October 9, 1964 The extreme selectivitj'that'1iils characterized the stock market for the past nine months still continues. Since the beginning of the year, the Industrial Average has advanced about 120 points from around 760 to 880. Percentagewise, the advance of 160/0 has been rela tively modest. Many individual issues have shown much greater advances, but also many stocks have shown below average action. The 160/0 advance has been a meaningless figure as far as most stocks are concerned. The technical pattern on the averages gives no indication of an important move in either direction at the moment, but individual stocks show evidence of relatively wide moves in both directions. The averages have been in an uptrend for over two years and the advance is probally.at a development. This is evidenced by the increasing selectivity and the slowing down of volume on a longer term basis. The twenty-fi ve week moving total of volume of trading on the New York Stock Exchange reach- ed a high of 622 million shares on the week ended May 22nd, and has gradually fallen off to a total of 576 million shares on the week ended October 2nd. These volume drop-offs usually give a warning signal long before the market reaches its peak. For example, in 1961, the twenty-five week moving total of volume reached a high in April and gradually started to fall off. The high in the average was not reached until November. In our recommended list, this letter has tried to counter the extreme selectivity in the general market by recommending issues where the technical pattern is strong and where the downside risk is compensated by a sizable long term potential. Most of the issues have shown above average action in recent markets. J. RAY McDERMOTT (35 7/8) has advanced frw weeks. While some consolidation may be needed, the long term potentials in t I i to make it an attractive long term holding. The same applies to P advanced 500/0 in price since the first of the year. r… v A ',8 D L (61 1/2) which has MOHASCO 151/8)entered our at around the 13 1/2 level and has a mod erate advance since that tim. .site Oak River Mill Dix.iana Mill of-thls company-laBt-week pr eLiwIth what I saw. I WIll go mto mor detail in a future letter. favoring the upper part of the n be around 1. 15 to 1. 30, with the od levels the stock appears favorably priced in view of the excellent 1 n 0e . J. C. Penn e r recommended list on September 15,1961. Currently, although it has a Ion rm oe potential of 72 from a technical point of view, it has reached its shorter te 'oe potential. The stock is, accordingly, being removed from our list, although inve s interested in quality and longer term growth may well wish to continue to hold it. However, more aggressive investors may well want to consider switch- ing into MONTGOMERY WARD ( 43), which seems to us to be a highl,y attractive capital gains vehicle. Almost everyone is familiar with the immediate post-war history of Montgomery War the company's hoarding of cash and its refusal to expand as did its major competitor. An equally well known story is the effort of new management since 1957 to recover the ground- lost. Unfortunately, in a company the size of Montgomery Ward, such recovery is a slow proc ess, but there is evidence that tangible results have already been achieved and that the har- vest of the company's belated expansion may be reaped more markedly over the next few years. Since 1958, ninety-two new stores have been opened and these units now account for some 440/0 of sales. The number of larger stores has been increased while small, less profiF able stores have been sharply reduced. Sales since 1957 have been increased by almost 500/0, and 1964 will probably mark the fifth consecutive year in which an earnings increase has been shown. However, the compa ny's need to put expansion above all else in the past seven years has placed a heavy penalty on profitability and recent earnings gains have been less t gains in sales. With the modernization program largely complete, it is felt that the company can increase its profit margin as well as show sales increases, and the effect on earnings could thus be dramatic. For the year to end Jan u a r y 31, 1965, earnings could well reach 1.75 per share versus 1. 56 in 1963-64. Further growth for 1965 appears to be in prospect From a technical point of view the stock has an upside objective of 53-66, and it is being add ed to our recommended list. Dow-Jones Ind. 878.08 Dow-Jones Rails 222. 12 EDMUND W. TABELL WALSTON & CO. INC. market leHer 1'1 not nnd under no CIrcumstances IS to be con …trucd ns, nn offer to sell or n soliCItatIOn to buy a.ny IIccurlbes referred to herem The informntlon c(Jntnined herem IS not )!Ullrnntccd as to nCC\lrncy or compJetenes'I anri the hn nlshm, thereof IS not, and un del no clrcumswncea I' to he construed a r(!pre,(!nta t'on b) Walston & Co. Inc All exprCSSlOns of oPinion are subject to chnnl!c \\Ithout notice. Walston & Co, Inc. and Officers, Directors, Stockholders and Enlployees therrof, 11Ull'hl'l.e, sell and may have nn interest 10 the !'ecurJtles mentioned herem. This market letter IS mtended and presented merely as a general mformlll commo;ntary on dn)' to day market news and not as a complete analYSIS AddltlOnal mformatlOn with respect to any securities referred to herem Will be furnished upon requco;t \\.. 301

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Tabell’s Market Letter – October 16, 1964

Tabell’s Market Letter – October 16, 1964

Tabell's Market Letter - October 16, 1964
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————————————————————————— — Walston &Co. Inc —– Le Members New York Stock Exch4nge NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COA.ST AND OVERSEAS TABELL'S MARKET LETTER October 16, 1964 A series of news developments were crammed into two days' trading and resulted in the widest market swings witnessed in quite a period of time. Prior to Thursday, the marke had held in a narrow trading shelf for almost a month and showed some indication of short term technical deterioration. However, from a technical point of view, there was no distri- butional top pattern of importance, and there was a strong support level at the 860-850 level in the Dow-Jones Industrials. Thursday's sharp decline on the news of Khrushchev's retirement brought the average down to an intra-day low of 861. 42, and was followed by a recov to an intra-day high of 877.71 on Friday. As we stated in Thursday's inter-office wire, we do not believethat.this is the,immediate-start of a broad marketdecline.-In.orcter.to indi-. cate a decline of more than short-term significance, a broader distributional top must be formed and this takes considerable time and a series of wide swings within a relatively narrow trading area. After some further irregularity, it is probable that the averages will make another attempt at the recent intra-day high of 882.39, and possibly even work modestly higher. However, we believe the market is in the lengthy process of forming a top of at least intermediate term importance. Our main concern with the broad technical pattern is due to' the unfavorable volume indications up until now. It is highly improbable that a broad advance will occur without a sharp increase in volume. In our letter of September 4th we expressed the opinion that the trend of volume would give us the clue as to the direction as well as the extent of, and probable duration of, the advance. We stated at that time on a thirty-five day e'moving total basis reached a high on May 7th at 156,903,0 s the Industrial Average reached 836.06 and has not been bettered 's igur s still not been bettered, despite the fact that the average has reacH w 11 g ritory some forty-six points above the May high. Thursday's – . ed ov otal of volume was – o. -. 139,586, 000 shares. New highs with declini v e a ften a warning signal of de- -creasing- o – s of'- — the high in the market and Without in any way trying to compare the 1961 pattern with the present, \ viewpoint, it is interesting to note the similarity of the two p'e o r e ched the high for the move in April, 1961 and was not bettered for t i . 'ng advance, despite modest new highs in the averages. The average reache in . and 733 in September, but volume failed to confirm the new high in price. It is point that we turned extremely cautious and advocated lightening commitmen strength. The average continued to a new high in November at 741, and this proved to be the high of the move. This high in price was reached seven month after the high in volume. Similar technical volume indications were witnessed at the 1959 and 1956 tops. So far in the present advance, the top volume was witnessed in May and was not bettered at the subsequent July high of 855.19 and the October high of 882. 39. The main difference in the two periods so far has been that, in 1961, the breadth index failed to con- firmthenewhighs..while -.in the-PTes enLmarket-1hebreadth-indexcontinue-s-to-conf.i-L'm-the – – advance in the averages into new high territory. All of this indicates that the present advance from the June 1962 low of 525 to the recent high of 882 has reached a mature stage and, despite the absence of a distributiJnal top of importance, a certain amount of caution is advisable. This applies-only to-the interme- — diate term trend. We continue of the belief that the market reached a major low in 1962 and indicates much higher levels in the latter part of the 1960's. A decline that retraced a portion of the advance from the 1962 lows to whatever high is reached on the present move would present, in our opinion, a very important buying opportunity. Again we mention the thought that the action of individual stocks is more important than the action of the averages. The stocks in our recommended list will, in our opinion, show above average market action and indicate, from a technical viewpoint, higher levels over the longer term. Dow-Jones Ind. 873. 54 Dow-Jones Rails 221. 84 EDMUND W. TABELL WALSTON & CO. INC. This mnrket letter IS not. (ond under no eircumstaneefllli to be construed 8.8, an offer to sell or ('ontnmcd herem IS not guaranteed aB to accuracy or eompleteness and the furn16hlnf;' thereof a 15 soliCitation to buy not. and under no any seeurlties rderTed circumstances is to be to herein. construed The information as, a representa- 110n by Walston & Co, Inc All expressions of opinion are AubJect to change Without notice Walston & Co., Inc., and Oft'icerIJ, Directors, Stockholders and Employees thereof mformal purchase, on day tsoeldl an ay d may marke have a t neWli n a in nd terest In not as a the securIties mentioned herein ThiS market letter 18 intended complete analysIs AdditIOnal Information with respect to any and presented merely as a general, securities referred to herem Will be furnished upon request. \\'N 301

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Tabell’s Market Letter – October 23, 1964

Tabell’s Market Letter – October 23, 1964

Tabell's Market Letter - October 23, 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 October 23, 1964 A year and a half ago, on March 15, 1963, we wrote a market letter which elicited some comment at the time. The letter was an attempt to explain the extreme diversity of action of individual stocks that had existed ever since 1956. In it, we broke the Dow-Jones Industrial Average down into three groups of ten stocks each. The first of these groups we called Early Peak Stocks, stocks that had reached their highs in the 1955-57 period. The second group we called Middle Peak Stocks, stocks that reached their highs in the 1959-60 period and the final group, Late Peak Stocks, those that reached their highs in 1961. C —- –, – – '– We then compared the relative performance of these three groups by taking an average of each one and adjusting the divisor so as to produce a figure of 524.37 at the 1956-57 high, this figure being, of course, the actual high reached by the Dow three times in the 1956-57 period. The results of this comparison were instructive. Investors will remember that the Dow exceeded its 1957 high in 1959, reaching 688.21, and then reached 741. 30 in 1961. The ten Early Peak stocks, however, were lower in 1959-60 than in 1955-57 (485.68), and even lower in 1961 (424.46). The so-called Middle Peak stocks reached a high of 736 in 1959-60, two years before the average itself reached that figure, but were lower in 1961. By contrast, the Late Peak stocks acted about the same as the average in the 1957-59 period, but by 1961 had advanced to a high equivalent to over 1000 in the Dow. Looking back at this study today, one thing aett hat was perhaps not obvious in 1963. Most observers of the stock at,after a stock reaches a major peak and declines, a long period of a form' is necessary before the stock again advances. This base su ta ime. It is, therefore, interesting that the so-called Early Peak tha de their highs in 1955-57, also, for the Even more interesting, Standard 011 of New Jersey a ,illlt . stocks, stocks such as Chrysler, M;lh-; have been the market leaders in the most recent advance. e average of ten stocks in the Dow that made their lows in 1960, an e t 962 low of 524, we find that these stocks have ad- vanced to an equiva t ov 00 in the Dow versus an actual high of 886. .. – In other word tocks that reached their peak early in the market cycle bad more opportunities t form bases in the late 1950's and early 1960's. Having completed these bases early, they have been the market leaders so far. A look at the technical pat- terns of many of these stocks, however, indIcates that some, at least, are close to their upside objectives, and a few have even reached these objectives. While there are still many investment opportunities among the stocks that peaked out eight years ago and are now in a upward cycle, i.t would .be logicaLfor the .inv.estor to begin tolook-for other groups tbat might, at some future date, take over market leadership. – In this connection, it is interesting to observe'the action of that group of stocks tba t made their highs in 1959. This group generally has turned in a performance inferior tR that of the average since the 1962 lows. However, a look aLthese stocks, mo st of them in the heavy industry-capital goods area, indicates tba t, by now, they have formed sufficient base patterns to indicate considerably higher upside objectives. One good place, therefore, to look for the leaders of the next upswing might be among those stocks that made their highs in mid-1959. Conversely, a good many stcks which were late in reach- ing their highs and did not make new peaks until 1961 may well require more time to com- plete the ir ba se patterns. Dow-Jones Ind. 877.62 Dow-Jones Rails 224.28 ANTHONY W. TABELL WALSTON & CO. INC. ThIS mlll kct letter is not, nnd under no cIrcumstance!! is to be construe liS. nn offer to sell or a soliCItation to huy any secUrities referred to herein The informatIOn ('ontalncd herem IS not gUllrnnteed liS to BCCUraC)' or and the furnishing thereof IS not, and under no clrcumstancC' IS to be construed as, B representa- tll)n hy Walston & Co, tnc All e,cpresslOns of OPIniOn arc subJect to change Without notice Walston & Co, Inc, and Officers, Dlrcctors, Stockholders lind ther('Of, sell and may have an Interest in the SeCUTltIes mentlOned hereIn ThiS msrket letter IS Intended and presented merely LS a genern, mformal comm..ntnry Oil tht) to da market IU'WS and not as a complete AddltlOnal mformatlOn ' Ith respect to any SeCUTltIes referred to herein be fnntsh('(lupon r('(1uest l\; 3Dl

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Tabell’s Market Letter – October 30, 1964

Tabell’s Market Letter – October 30, 1964

Tabell's Market Letter - October 30, 1964
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Walston &- Co. F LE —–Inc —– Members New York Stock Exchange ; NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER October 30, 1964 Extreme selectivitYJclJ)riti1Tlues to feature the market. While the various market aver- ages are churning around in a trading area that has prevailed since mid-September indivi- dual issues are moving both up and down in their own independent trends. There is no imme diate indication of a change in this highly selective rna rket action. Technical indicators show no signs of a broad move of importance in either direction as far as the averages are concerned. The same action is occurring in the stocks in our recommended list. Many issues have shown little price change in recent markets. On the other hand, issues like Koppers Co which like U;iited Fruit has droppe-cj back to its low. J. P. which moved up in 1963, rested in the 35-40 area during the first half of this year and has now advanced to 48. Beaunit Corp., which has held in the 30-35 range since the start of the year, broke out of this trading area and reached a new high of 36 tOday. Numerous other examples could be cited both on the upside and downside. While certainly not everyone of our stock selections has been correct over the years, this letter can at least boast a perfect record for predicting the winner of each Presidential election since 1948. This may be due to good luck rather than political perspicacity, but w would like to keep our record unblemished as long as possible. This year, it is not a diffi cult task. Our prediction is that Johnson will be elected on November 3rd. This is hardly a startling prediction when the a 67 to 33 edge for Johnson as far as the popular vote is concerned. If the po r tect, this would be the greatest landslide in our political history and woulC\1!!Ve.'3!. us Roosevelt-Landon debacle in 1936 when Franklin D. Roosevelt 0 e ular vote. However, we have a feeling that while Johnson will be the winner, fin sults will be closer than predicted by the polls. I . stickers as compared to past e . to indicate that, except for a- small but rabid group of Goldwat ,t verage voter seems quite apathetic about the whol thing and is stra y both candidates cer' u h 0 ally announce his selection. The campaign tactics of one much to change that feeling. It has been an extremely disappointing campai de d largely to name-calling rather than a serious discussion of vital issues. Even if the polls are correct in the assumption that 67 of the potential voters prefer Johnson over Goldwater, the final results could still be closer than the polls indicate. How many potential voters are actually going to vote Even in the much more intelligent Kennedy- Nixon campaign, only 70 of the potential voters actually voted. Most voters are either pro or anti-Goldwater, rather than pro or anti-Johnson. The Goldwater voters, while much smaller in number, are much more rabid, and the percentage of them actually voting will be larger than that of the Johnson followers. The apathy of this group could make the final results closer, but Johnson will still be the winner. ' What effect will the election of either candidate have on the stock market Probably very litile. The market has already adjusted to Prestdent Jghnson's II'\ the unlikely event that Senator Goldwater wins, there would undoubtedly be a sell-off, mainly because most people – particularly abroad – feel that a Goldwater election would cause a sell-off, and would start selling. This, however, would probably be moderate and brief. The long term favorable fundamental factors would predominate in the end. Goldwater is suspect because of the fear of a possible sharp cut in government spending if he is elected. This is not very realistic. The fringe spending might be cut, but there are too many areas where the government is too deeply committed for any drastic cut-back. President Eisenhower found this out in his two terms of office. Dow-Jones Ind. 873.08 Dow-Jones Rails 223.54 EDMUND W. TAB ELL WALSTON & CO. INC. mnrket letter IS not. Ilnd TlOI1r't!tlttlSttmees'J'.'tt1me construed as, an offer to lieU or a sohcltatlon to buy any securities referred to herem The information …nntnmecl herem IS not guarnntePd ns to accuracy or completeness and the rurnlshmg thereof IS not, llnd under no circumstances 18 to be construed B.S, II tmn by Wnlston & Co, Inc All e'lpTCSSlOns ot opmion ar!) Bubject. t.o chango Without. notice Walston & Co, Inc. and Officers, Din-etoTB. Stockholders and Emllloyees thereof, purchase. sell and may have an mterest III the securities mentlOnod herein. This market letter IS mtended and presented merely as a general. Informal commontary on d8)' to day market ne.,'I'l1 and not as a complete analysIs Additional mformatlon With respect to any securities reterred to herein will be furnished upon request \\N 301

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