Tabell’s Market Letter – November 25, 1966

Tabell’s Market Letter – November 25, 1966

Tabell's Market Letter - November 25, 1966
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-. Walston &Co. Inc – – – – – MUNICIPAL BONOS UNDERWRITERS MUTUAL FUNDS Membe New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER The market continued its short slide on Monday and Tuesday of this week a 1C' at l.' I Tuesday's low had reached(;tlief.790Cdownsid,h;obJective mentioned in last week's market letter. A rally late Tuesday afternoon and Wednesday (which continued In the Friday post- holiday market) brought the Average to a high of 803.33 on Friday. Based on the action of most short-term indicators, and the onset of tax-loss pressures in many issues, we are inclined to expect continued irregularity into December, and con- tinue to advise the purchase of selected issues on weakness. One sl'ch issue is reviewed below. COLUMBlA BROADCASTING SYSTEM, I.C. Current Price Current Dividend Current Yield Long-Term Debt Common Stock 57 1. 40 2 5 94,600,000 20,312,778 shs Sales-1966-E 785,000,000 CBS means Channel 2 to millions of New Yorkers addicted to the fine art of TV analysis. To the almost 42,000 shareholders, CBS represents the hope of capital appreciation over the long-terrr.. Recently added to the Quality Long-Term Growth sect. on of our Recommended List, based on the favorabJe technical indications that combine to suggest an objective near Sales-1965 699,000,000 80 a share, Columbia Broadcasting System also has Earn. Per Sh 1966-E 3.00 an impressive array of fundamental factors to support Earn. Per Sh. 1965 Mkt. Range 1966-65 2. 40 335/8-62 our conclusions. CBS operates vision networIsrwith r lorgest radio and tele2 affiliated radio stations and s .n He these broadcasting activities are responsible for the lion's share of and nings, the outstanding man- agement team co-captained by William S nton continues its aggressive of diversification. Pwer through a desIred , — This diversification the following results in recent yearsthe ownership of the New Yo iin ba effitrl team, the purchase of 11, or almost 400,000 shares, of t e u s ' 0 n stock of Holt, Rinehart & Winston, a leading pub- lisher of textbooks, i eadily expanding musical instruments market, vast ex- pansion of overseas 0 ra io sound recordings and music publishing, and what could be an initial position in the estate field. The recent acquisition of Creative Playthings, Inc. , suppliers of materials r nursery schools and kindergartens, is another important step into the educational market. The most promising of these ventures, based on prevailing long-term projections, would appear to be those dealing with education. When the Holt, Rinehart stock was purchased, the prevailing market price of the publisher's stock suggested a total purchase value of approxi- rna tely 19 million. In view of the impressive demands expected to be made on the nation IS' educational facilities in the coming decade, and the resultant requirements for textbooks and other materials, this investment could provide considerably more than the initial investment just in dividend returns over the next 10 to 15 years. It is anticipated that CBS will increase its investment in Holt as time passes. Expressing their of earnings and -theprospects believe in store for the future, CBS directors recently increased the quarterly dividend from 30 to 35 a share, effecting an annual payout of 1. 40. For the current year, earnings are expected to make one of the largest gains of recent years, rising from 2.40 a share in 1965, to an esti mated 3.00 this year, on projected sales of approximately 785 million. Although no firm estimate currently is available.fornext year; 1967 results should show a continuation of the uptrend. The coming year will continue to benefit from royalties being received on the film My Fair Lady, rights for which have been sold to Warner Bros. Pictures. Under terms of this agreement, CBS is to receive royalties of 47 1/2 of the gross exceeding 20 million from worldwide rentals, and the 20 million mark was passed late in 1965. Exhibiting excellent relative strength and with considerable downside support in the 50- 55 range, Columbia Broadcasting System shares are recommended for purChase at prevailing market levels. Dow-Jones Ind. – 803.34 HARRY W. LAUBSCHER for ANTHONY W. TABELL Dow-Jones Rails – 203.44 A lTIDItW. letf..eLjlt…Publiahed for your convenience and information Rnd Is not an offer to Bell )r a VVtohiufiloYtV llta3 from sources we believe to be reliable, but we do not guarantee Its accnrnry emplOYeeB may have an mtereet in or pupchase and sell the securIties referred to herein. WALSTON & CO. INC. to buy any dlllCU&J.,..(i. T.4e -;'\'l1laton & Co., .Inc. t nd tU officers, dlreetors 0 WN801 –

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