Walston &Co. ———lnc ——–INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER J u1Y 22, 1966 The market last week continued to hold for the 46th trading day in a narrow range by 910. 35 on the upside and 858. 90 on the downside. After reaching an intra-day on Monday of 892. 98, the market continued to drift steadily downward on consistently llght volume, reaching an intra-day low on Friday of 864.97. The eventual move out of this trading area remains uncertain. If this trading area is violated on the downside, it is possibl to correct the Averages to the 840-825 area. The recent weakness in the market, as noted by this letter last week, has been due not to selling pressure as experienced in the May decline of this year, but rather to lack of buying power. In order to move the Averages out of this trading area on the upside, indicating higher levels, a broad-scale revival of buying power must become apparent. This remains conspicuously absent. Outlining the pattern for the Averages does not describe a number of issues which show good prospect s for outperforming the general market. One such stock is reviewed below. WALLACE & TIERNAN, INC. Current Price 38 1/2 Current Dividend 1. 10 Current Yield 2. 860/0 Long Term Debt None COmmon Stock 4,160,601 shs. Sales-1966-E 102,000,000 Sales-1965 94,170,000 The ability to develop a product or process to fill a new need in a new market and, having established this product or process, continue to maintain a dominant position, has been a determinant that has underlined the success of many well managed corporations. Wallace & Tiernan (originally recommended list on August 2, 1965 at siDfifty years has es- poused this it e ly rewarding resulis. Earn.per sh. 1966-E 2.60 For over five E arn.per sh 1965 ' d2.24 consolidation 'lVerSi 0 u r h ell planned program of ion, Wallace & Tiernan, a hem'ica1s, i.nd ustriaI equi.pment Current -36,1/-2 ..'' r e, and d'l'ugs, has-evolved . a -part company, each approximately eqUll in size and importance. \. 1 extremely diversified in nature, enabling the company to show a e growth in sales and earnings for the company as a whole. . in section is often counterbalanced by stability and growth in other sec' ThJ ca e management team has strengthened the corporate stru ture and increased to s Ie stantially through internal development and a well planned acquisition program. Eac ction of the business is a complete entity within the corporate framework. This auton ous approach has the advantage of maintaining the objectives within the division. These divisions include – the Chemical Group (390/0 of 1965 sales and 390/0 of net income) manufactures and sells organic peroxies, fatty acids, sebacic acid and plasticizers, compounds for bleaching, maturing and enriching of flour, and decay control processes. The Equipment group (310/0 of 1965 sales and 240/0 of net income) manufactures and sells chlorina- tion equipment for water purification, sewage and waste treatment, and swimming pool steril- ization, industrial flow metering equipment and other related items. continuous dough-making process for the baking industry, equipment and materials used by the fresh fruit, produce and citrus industries, and offers engineering services and supplies, cathodic protection materials and services. The Pharmaceutical Group (300/0 of 1965 sales and 370/0 of net income) manufac- tures and sells ethical pr-esctiption drugs and cCfflSumer proprietary drugs. The growth and development of this company can best be experienced by reviewing the last five years of the corporation's history. In 1961, sales volume has increased from 64 million each year to 94.7 million in 1965, an increase of over 450/0. Earnings per share have experienced an ever greater continuous increase 1.. 22 .i111961 to 2.24 in 1965, or 830/0. The're is no reason to believe that the strong earmngs gam will not continue and carryover into 1966. Earnings for 1966 are estimated at 2. 60 on estimated sales of 102 million. Wallace & Tiernan continues to attract the attention of the investment community des- pite the heavy concentration of ownership by insiders (over 500/0). The stock, which s.old for 33 times earnings in 1961, is now available for 15 times estimated 1966 results. Techmcally, a downside objective of 37 was recently realized. Remaining in support in the high 30 area, a long term upside objective of 63 is indicated. Relative price action remains good and on I minor weakness continued purchase is recommended. D')w-Jones Ind. 869.15 Dow-Jones Rails 224.79 ANTHONY W. TABELL WALSTON & CO. INC A W IS mnr e Ie ter 19 published for your and mformatlOn IS not lin offer to sell OT 1\ 'loilcltatlon to buy any securities dlSl'ugsed TnI' In- fOlmation as obuuned Cram sourC'e'l we blheve to he relHlble, but I' do not g\l'lrantee Its ,II'Iton & Co, InC' and it., officers, dlr('('tors or emloyee'l raay have an mterest In or purcha.,(. and sell the rfferred to helcm WN301 J,

Walston &- Co. Inc INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER July 29, 1966 From time to time, this letter has commented on the bull-bear syndrome, a disease which occasionally afflicts some market analysts and a great many investors. Since this week's market action brought occurrence of the syndrome to epidemic proportions in the financial community, the time is perhaps appropriate to discuss the phenomenon once more. The most noticeable symptom of the disease is, of course, a compulsive desire to pin labels on the stock market. To the sufferer, a given market is either (a) a bull market or (b) a bear market and there is no room for any gradation in between. The disease most re- cently began to crop up last April when the Dow Theory delivered its recent pronouncement that we ,had.indeed been in a bear market-since -Februa ry and that investors should, accord- ingly, take warning and run for the hills. With this week's market action, when the failure of the Dow to hold above a previous low on Monday triggered a sixteen-point sell-off, followed by a new low on Friday, the compulsion to pin a bear market label on the present stock mar ket became utterly colossal. The bull-bearsyndrome is, of course, One of the most widespread barriers to clear thinking existing among investors. What is of interest to the investor is the number of stocks which can with some certainty be said to be in uptrends. At certain times almost all stocks are in upward or neutral trends and it is possible to achieve investment success by almost random stock selection. At other times, so many stocks are in apparent downtrends that it becomes impossible, even with the most rigorous standards of selection, to choose attractive equity investments. The point is, however, that between these two and white there exist an almost infinite number of shades of grey. In certain in n Wlth gh the maJority of stocks may be moving up, a fairly significant 1 act in downtrends. Like- wise, it is possible to envision exactly the opposite – a et where, while the major ity of issues are tending toward lower tial minority is resisting this Now let us take-the-rrfost ri -the Dow-Jones-Industriai – Average had declined 150/0 in This decline was exceeded by only four other downswings in the ost- r i ariil., if one looks only at the Averages, it is cer- tainly tempting to att h r abel to the experience of 1966 so far. There is, however, strong n appelation is misleading. Quickly to cite a couple of statistics, a recent 01 eading stocks showed that, at recent prices, 156, or al- most one-third, were bo e same or, in fact, higher than they had been in February when the Dow made i gh at 1001. 11, 15 above present price levels. Now, obviously, when two stocks out of three are in fact moving downward, the process of security selection becomes immeasurably mace difficult. This is not to say it becomes imp03sible. This is borne out by many recent reports of investment company results for the first six months of 1966. A great maJority seem to be showing only a minuscule decline in net asset values per share and a significant minority have indeed appreciated very nicely during the recent six months bear market. The important thing at the moment is that a study of individual stock patterns indicate a strong likelihood that conditions in the second half of 1966 are very likely to resemble those of the first half. In other words, while it is difficult to become enthused about a great many stocks a.t the large majority, remains a signi- ficant minority of issues which are both technically and fundamentally attractive and which have every prospect of performing very well over the next few months. This is, of course, not a bullish position and to call it such would be to commit the error diametrically opposed to the one discussed above. However, the contention that good stock selection can achieve moderately successful results over the next six months, just as it did over the past six months, is the one that seems to come closest, to the reality of today's stock market. — Dow-Jones Ind. 847.38 Dow-Jones Rails 220.19 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb ThiS market letter is pubhshed for our convenience fLnd mformlltlon Rno ' not an offer to sell or II soil('ita.tion to buy Any !leC'!urlti(S dlS(!usfied The In- formatIOn 'RS obtmned from sources we bt-lieve to be rellable, but we rlo not Its tH'curRrv 'RIston &.. Co. Inc. Rnd It. officeI'). dlr(''tors or emJ'lo)ees mil) have an mterest in or vurchase nnd sell the secuntw; ref.rrell to herem ——… –

—- Walston &- Co. INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER August 5, 1966 The market slide abated this week, ostensibly under the stimulus of the steel price rise. The Dow-Jones Industrials, after reaching an intra-day low for the year of 827. 28 on Tuesday, advanced almost 19 points in moderately active trading on Wednesday and Thursda The rise continued at a somewhat slower pace on the final day of the week with an intra-day peak of 860.57 being reached. At the low of this week, the Dow had reached the 840-825 range which we had en- visioned as a possible downside objective for the Index. At that point, various short term in- dicators had reached sharply oversold territory, and the general market was as deeply over sold as.it.had been at any time since the bottom position of this nature, a rally toward the overhead supply in the 870-880 area would appear to be a plausible expectation. Ability to push well into this area on the present move and the to hold would have to be considered extremely bullish insofar as the general market is con- cerned, although there is no definite indication at the moment that this will take place. In last week's letter we pointed out that, while the recent decline had been exceeded in severity by only three previous downswings in the post-war era, it had, nonetheless, been quite selective. As we suggested, a great many stocks are, today, selling at higher levels than they had been earlier in the year – despite the fact that the Averages were then conside ably higher. In this sense, action is very much reminiscent of the first three quarters of 1960. During this time the Averages were in an almost continuous downtrend – approximatin the current one in extent – but a great many issues moved up quite sharply. We continue to feel that the action of individual issues will be Averages. As most investors should be aware, the presen 0 than that of the g es not date back only to last February when the DJI made its high. Aaa so, in;luding some of th highest grade issues available, reached their peaks uch as teen months to two year ago in late 1964 and early 1965. These stockm e b n rrective phase for the entire inyervel1.iEg.period and, in many ent levels. On the other side of the-c; e ave a! pre.s- e -m stocks-iii such diverse industry group as Office Equipment, O ( a continued to move ahead despite the weakness in the market, and s s n deterioratbn. In short, it is still not 2hard to find attractive is u c , especially since the recent weakness has brough a great many stoc t t 0 upport levels. Regular rea titer will have noted that we have not, during the recent de- cline, followed the poli astically reducing the number of issues in our recommended list. This policy, of c e, has be en in line with our feeling that stock selection is more im portant than the trend of the Averages. By and large, we have been pleased with the perform- ance of most stocks in our list, and we will continue to follow the policy of considering is- sues individually rather than making drastic changes due to general market trends. In a de- cline such as the recent one, however, there are in any list certain stocks which turn out to be particularly susceptible to downward market pressures. In such cases, our general policy is to ascertain whether the original reasons for recommendation are valid. In most cases, if the technical and fundamental situation has not changed, it is best to hold such stocks or average down, pending further developments. Two issues from our Recommended List come to mind. Parke Davis (28), suggested last April at a price of 36 1/2, moved to a low of 27 earlier this week. At that level it had just about reached the downside objective of a short term top formed in May and June. We originally suggested the issue on the basis that the expiration of Chloromycetin patents in October had been drastically over-discounted, and we still feel that this is the case. The co pany's present dispute with the I n t ern a 1 Re venue Service does not, we believe, fundamen tally alter the situation. General Dynamics (46), which reached a low of 44 1/2 vs. a high of 66 1/2, is pre- sumably under pressure due to weight difficulties with the Navy version of the F-111 Fighter Unnoticed in the furor has been the fact that the Air Force version which will account for the larger portion of the contract, is proceeding on schedule with initial production under way. Although the technical picture has deteriorated somewhat, earlier earnings estimates of 5.75 for 1966 still appear valid and the stock appears cheap at present levels. Dow-Jones Ind. 852.39 Dow-Jones Rails 219.62 ANTHONY W. TABELL WALSTON & CO. INC. AWT' amb This market letter 1& published for your convenience and Information and Is not An ofter to eell or R solicitation to buy any eeeurities dlBCUSsed. The informatIOn WlLII obtained front sources we believe to be reliable. but we do not gUarantee its accuracy Walston & Co.. Inc. Rnd Its officers. dIrectors or employees may have an interest In or purchase and sell the securities referred to herem. WNSOI

Walston &Co. Inc INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER August 12, 1966 , Earnings multiples have, historically, been the subject of a great deal of theorizing. On the one hand, the financial community has been beset of late with a horde of academic types armed with complicated valuation models which prove their favorite stock is worth 43-1/2 times earnings. On the other hand, the popular reaction today to low earnings multi- ples is to point out that, after all, earnings are expected to decline in 1967 and the current low level of stock prices only reflects this fact. One is reminded of the hordes of experts wh assured us that stocks were dangerous in 1949, because the inevitable post-war depression was about to come crashing down on our heads. Historically, at least, most theoretical justi- fications for price-earnings multiples have been notable chiefly for their inaccuracy. It is just possible that a more relevant approach to earnings multiples may be to. com pare their current levels to levels achieved in the past. The following table attempts to do this for the thirty stocks in the Dow-Jones Industrial Average. In the first column are given estimates of 1966 earnings. Succeeding columns show the price/earnings ratio which prevail ed at the lows of 1949, 1953, 1957 and 1962, historical low points in the stock market. Fol- lowing this is the level the stock would sell at if 1966 earnings were capitalized at those mul- tiples. If the resultant price is about the same or higher than the recent price, given in the last column, the figure is underlined. The table is worth a glance. It shows, for example, that 23 of the 30 stocks are cheap er today than was the case at the 1962 lows, and half of them are cheaper on an earnings basis than was the case at the 1957 lows. It is necessary to go all the way back to 1953 to find a case when the majority of stocks had lower in this case, 9 of the 30 stocks are lower today than was then the case. Amazing e fstocks can be bought cheaper today than was the case in 1949. Allied Chern. Earn. 3.25 1949 PIE Price 10 32 1/2 1953 PIE ,T–J'!-/9 4 52 1 9 13 2 PIE Price 16 52 Close 8/12/6 387/8 Amer.Tel&Tel 3.60 15 Amer. Tobacco Anaconda 10 5 Bethlehem Steel 3. Chrysler 5.75 DuPont 9.00 Eastman Kodak 4.10 11 General Elec. 4.60 8 General Foods 3.85 9 General Motors 6.50 4 Goodyear 3.50 5 Intern'l Harvester 4.00 5 Intern'l Nickel 4.90 10 Intern'l Paper 2.60 3 Johns Manville 4.50 6 Owens-Illinois 3.70 12 Procter & Gamble 3.45 8 Sears Roebuck 2.50 7 Std. of Calif 5. 60 5 Std. of New Jersey 5.25 6 Swift & Co 3.75 6 Texaco 5.15 4 Union Carbide 4.1010 United Aircraft 6.00 9 U. S. Steel 4.50 4 Westinghouse El. 3.50 5 Woolworth 2.65 11 1 8 23 99 45 367/8 345/8 26 171/2 20 49 73/4 27 443/8 -27 5/8 171/2 28 31 1/2 22 1/2 205/8 41 54 18 17 1/2 29 1/8 4 15 54 18 647/8 53 41 9 283/8 13.i!… 7 73 1/2 6 63 9 94 1/2 32 1/4 77 3 101/4 8 27 1/4 10 34 31 1/2 8 46 5 28 3/4 9 51 3/4 37 17 1653/4 19 1851/4 17 1653/4 1811/2 15 61 1/2 17 693/4 23 943/8 128 12 55 21 965/8 18 823/4 943/4 13 50 12 461/4 19 73 1/8 72 1/4 8 52 13 91 11 77 78 l/E 4 14 12 42 14 49 7 28 10 40 13 52 10 49 11 53 1/4 15 781/2 8 203/4 14 363/8 15 39 41 3/ f 847/.8 27 1/8 9 401/2 14 63 14 63 13 48 1/8 11 403/4 15 55 1/2 513/4 66 14 48 1/4 14 48 1/4 21 72 1/2 653/E 11 271/2 11 271/2 20 50 531/4 8 44 3/4 10 56 11 615/8 62 5/8 8 42 12 63 12 63 67 5/8 7 261/4 13 483/4 12 45 463/4 8 41 1/4 10 51 1/2 12 613/4 685/8 17 693/4 20 82 17 693/4 551/2 6 36 6 5 22 1/2 7 36 19 114 31 1/2 13 58 1/2 77 40 9 31 1/2 18 63 18 63 46 1, 14 37 1/8 11 29 1/8 13 34 1/2 215/8 Jj)ow-Jones Ind. 840.53 Dow-Jons Rails 214 .54 ANTHONY W.TABELL WALSTON & CO. INC. AW letter 18 pubhshed for your eonvemenee and infonnatlOn and is not f\n offer to sell or 1\ to buy any aeeuritles dlseussed. The Ln- -formation was obtained from sources we Ix.heve to be reliable, but we do not guRrRntee its BccurRC), WRIston & Co.. Inc Rnd Its officers. dlref'tors or employees may ht'LVe an mterest in or purchase and sett the securities referred to herein , WN.SOI

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Walston &Co. INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER August 19, 1966 In our market letter of December 23, 1965, with the Dow selling at 966, we attempted to assess the ouUook for the coming year. We started out by saying – (The) ouUook for 1966 corporate profits is almost uniformally roseate.. We are inclined to believe that the cor- porate profits ouUook for 1966 is quite adequately reflected in the prices that are being paid for stocks today. We are, therefore, less impressed by the generally good profits ouUook than we are by the number of potential psychological factors which could disturb market librium at some time during the year, i. e., tight money, balance of payments problems, Viet nam, etc. It is a market, we think, where psychological factors will predoininate more and more. – – -. . Following an assessment of the technical picture as it appeared at that time, w'e c'on' cluded with the thought that – It is very difficult at the moment to find arguments for a sus- tained rise in stock prices from these levels and it is equally difficult to find cogent reasons why a decline of serious magnitude should take place. The logical forecast, therefore, seems to be tqat there will be very little change in the popular averages from their recent levels. The 1965 range on the Dow-Jones Industrials was 974. 16 high and 832.74 low. It seems prob- able that 1966 figures will be fairly close to these. So far both limits have been exceeded by modest amounts. We do not, however, cite the above figures as part of an attempt to win first pJ;'ize in a uessing game. We do cite it as evidence of the extent to which the wheel has come full cycle in a relatively short period of time. It was incorrect to become wildly bullish in early 1966 ased on corporate profits for one very simple reason. Jilfofits picture was al- ready reflected in the price of most common stocks. It is n f to become quite loomy about the future course of stock prices due st r ,Vietnam, and fears f inflation followed by a recession. The point is that f thes ngs constitute not so uch a reason for stock prices to move an 'on of why stock prices are hereyey If were .e f e mic uncertainty eguities would not be available at their e. . Now we are as reminded ad nauseam. We do n n to economic uncertainties of which we are how or whether all of these difficulties will be resolved and one else does either. Rather than engage in a frui less attempt to pre t i e, it seems to us much more important to try to gauge the investment odds Jj ffer ya stock market with the Dow-JOnes IrldustFial Average hovering around the 800 Ie Future prices e determined by two factors, – the then current level of earnings and the price earnings ratio which the market at that time is willing to apply to those earning It is certainly too early at this point to say what 1967 earnings may be, so in the table below we are providing four different earnings estimates ranging from a 100/0 improvement over es- timated 1966 figures to a 250/0 decline — equivalent to the severest profit decline in the post- war period. These earnings are capitalized at four different levels – the 1951-53 'average of 10.7, the current one of 14.2, the 1954-58 average of 16.2, and the more'recent 1958-1965 average of 19.2. Thus, we arrive at the prices shown and their percentage difference from current levels. 1951-53 Aver. Current 1954-58 Aver. 1958-1965 Aver. 10.7 14,2 16.2 19.2, 66.00 (1966 plus 10) 706 (-120/0) 937 (16) 1069 (32) 1267 (570/0) 60.00 (same as 1966) 642 -200/0 852 ( 60/0) 972 200/0 1152 (430/0) 54.00,(1966 less 100/0) 577 (-290/0) 767 (- 5) 875 ( 8) 1037 (280/0) 45.00 (1966 less 250/0) 450 (-440/0) 639 (-21) 729 -10 864 ( 7) All that the table shows, is that, if one is to predict a sizable decline, in stock prices from their present levels, one must also be willing to predict either a decline in corporate earnings of record proportions and/or a return to valuation standards which have not existed for thirteen years. Any investor who sincerely believes that either of these events will come to pass should certainly divest himself of common stocks. We prefer to think that the recent stock price weakness has brought more stocks close to attractive long-term purchase levels than has great number of years. Dow-Jones Ind. 804. 62 Dow-Jones Rails 202.55 AWTamb ANTHONY W. TABELL WALSTON & CO. INC. This market letter is published for your convenience and infonnatlon and lS not an offer to sen or solicitation to buy An,. IleetJJities The in- formation WAS obtained from Bmnees we btlleve to be rehable. but we do not guArantee ita aCcuracy WAlston & Co Inc. And Its ofl'lcers. dlrectorB or cmpiOJees may have an mterest in or purchASe and sell the securities referred to herem. WN.801

ALe W—-a–l–s-tIoncn.–&—C–o–. INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges TABELL'S MARKET LETTER OFfiCES COAST TO COAST AND OVERSEAS August 26, 1966 Although interrupted by a sharp rally on Wednesday, the Dow-Jones Industrial Average continued its slide last week, reaching a new intra-day low of 776.27 on Friday. This level constituted the lowest figure seen for the index since early 1964, and capped a decline of 22.4 from the 1966 high of 1001. 11 reached some twenty-nine weeks ago in February. On a percentage basis, therefore, the decline ranks as the third sharpest dip in stock prices in the post-war period, being exceeded only by the declines of 1946 and 1961-62. At this stage of a market downswing,it is invariably futile to try to guess as to what the exact low pOint in the Averages may turn out to be. Certainly, no indication has yet appeared of any renaissance of buying power which.will be necessary to spark a reversaLof.the present,drop.in.prices .. It . seems far more sensible to make an objective to judge whether stock prices indeed have retreated to a point where they are objectively attractive on a long-term basis. The major burden of the last two issues of this letter has been to point out the fact that investment grade stocks were inherently cheap when judged by any historical standards. In our letter of last week we.gave projected levels of the Dow-Jones Industrial Average based On various multipliers of 1967 earnings. The figure rather conclusively showed that current prices apparently discounted anything short of a major recession in 1967. In the previous week's letter we tried to suggest that a great many of the 30 stocks in the Dow-Jones Indus- trial Average were, at their then existing prices, at lower levels in relation to earning powe than they had been in some years, in a few cases lower based on earnings, than they had bee in 1949. At the present time a study of the technical patterns on a great many investment grade issues strongly tends to suggest that they are at or major lows. The foregoing is certainly not true of all stocks at th certainly does hold good for a great number of issues. The stock markeBe s two rs has been a highly selective one, both on the upside and the downside. the' n the Dow was reached in February 1966, the high in a great many men ad' sues in the Dow was reached t.trOllfiJhout 1 . . ' b to point that two markets have been eXlshng s – a marKet lIT glamour ana speclalty issues, and a bear market h-S i This latter bear market is a good bit more than six months old. In t c 0 many stocks, it is more than two years old, and the declines ee l e suggest that a major correction may be fairly close to being com t Let us amplify s ta e a bit further. Although the Dow made its high in Februar of 1966, only 9 of the 3 D omponents actually made their post-1962 highs during 1966. Allied Chemical reach s high as early as December, 1963. American Telephone, Chrysle General Foods, International Paper, Procter & Gamble, Standard Oil of New Jersey and Texaco all reached their bull market peaks during 1964, two years before the high in the Do and the remaining issues reached their peaks at various times during 1965. The dips in individual issues, since peaks were reached one to two years ago, have been sharp. Chrysler has declined 510/0 from its high, and three stocks in the index have de- clined 400/0 from their bull market peaks. Another 16 stocks have declined 300/0 or more. These percentage declines are in some cases comparable to those which took place in 1962. The most important factor to note, from a tedinical point of view, is. that these sharp declines have, in most cases, brought investment grade issues to, or close to, their long-term downside objectives. Noneofthis is.intended to suggest that a rally in these issues is immi- nent. It is rather intended to mean that a substantial group of issues are completing correct- ions of long-term importance and may well be approaching major lows. When these issues are coupled with the whole host of stocks which have, throughout the decline, held up rather well and maintained relatively favorable long-term technical patterns, it becomes possible to say that more stocks are now attractively priced on a long-term basis than has been the case in a good many years. Dow-Jones Ind. 780.56 Dow-Jones Rails 195.03 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb This market letter is published for your eonvenienee and information and ill not I\n offer to Bell or tI. i8OIkltatlon to buy any eeeurities dlseussed. The in- formation was obtained from sources we believe to be reliable. but we do not guarantee its aeeuraey Walston & Co, Ine. and lts offieers du'edors 01' employees may have an Interest In or purebase and sell the seeunties referred to herein, ' WNSOl

—- — — – – – – – – – – – – – Walston Inc ——— – —- FILE INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BOlDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER September 2, 1966 Last week's stock market was an exciting and interesting one. On Monday, the 13th consecutive blue Monday on which the market had sold lower, the Dow-Jones Industrial Average continued its long slide from the February high, and with almost a indicator smmillaiionntasinheadrebsyttrhadisindge,padrrtomppenedt 13.53 points. showed an ove At that point most of the short-ter rsold condition of all-time record m proportions. On Tuesday, the market bounded back sharply at the opening gong and shortly after 11 o'clock had advanced more than 10 points from Monday's close with the tape running .late and with the heaviest volume in recent months, declineJhenset5n.wl1ich cul- minated in the early afternoon and brought the Averages down to an intra-day low of 759.52. Volume then picked up again, prices began to rally, and the Dow finally wound up 8. 69 poif\ts up on the day with 11,230,000 shares changing hands. On Wednesday, the rally continued wit 8,690,000 shares trading and the Average advancing 12.69 pOints to close at 788.41. At this point, the character of the leadership had become evident and although many of the blue chip in the Average advanced, the glamour issue& were weaker. Another 3.50 point advance on modest volume took place on Thursday, and here the story was entirely blue chip issues, wit almost all of the volatile issues declining. On Friday, the Averages retreated on reduced volume of 6,080,000 shares, with most of the decline being erased by strength at the close. The Dow declined 4.40 pOints, but many volatile issues, especially the airlines, were off quite sharply. The obvious oversold condition at the beginning of with the sharp snapback on Tuesday and Wednesday, led to a plethora of f e a n 'fue financial commu- nity that a was under way. i n far this technical rally might carry were issued, and most analysts se to el the situation was great ly improved insofar as the short-term outlook w s co ne ile still remaining highly in terms.of the Sltuatlon-may-be'preclsely the -'e letter is that , – – —- – — —– We see, at the moment, no to become wildly ecstatic over the im- mediate future for stock take the trouble to study deeply oversold markets, such as on have varied widely' a arly this week, would find that their aftermaths d ree. In some cases, the oversold condition has per- sisted for some tim a Ie e market lower – in other cases a sharp snapback has taken place followed b n ly sharp drop into new lows. In a few cases, a long and wort while rally has 'ensued. ever, a wide range of historical responses to a deeply oversold condition makes this I er reluctant to hazard a guess as to what the immediate picture may be until such time as the pattern clarifies. We are, therefore, unwilling to make any assumptions as to a change in trend in the stock market. That trend quite obviously has been down and must be considered to be so un- til much more persuasive evidence of a reversal presents itself. We do feel, however, that many stocks are approaching a level which, on a long-term basis, to us, is highly interest- ing. We have pointed out in a number of recent letters that a number of highgrade issues wer becoming dramatically cheap by historical standards. We have indicated, furthermore, that a great number of stocks were approaching, or had reached, major downside objectives. This continues to be the case, although it muste noted that there are t.1J.ose which appear to have considerable more room on the downside. It is one thing for a stock to reach a downside objective and another thing for it to form a base and start to move up again. In many cases, a great deal of time will be required before bases hove formed, and it is precisely for this reason that we find ourselves unexcited about immediate prospects for a great many stocks. What we do feel, however, is that the de cline has reached a stage where the long-term investor would be wise to pursue a policy of making purchases on weakness in individual issues as downside objectives are reached. Ther are a great many exciting values in today's stock market and more will become available as time goes on. The patient investor should use market weakness to take advantage of them. Dow-Jones Ind. 787.69 Dow-Jones Rails 195.18 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb ThIS market letter IS published for your convemence and information and Is not lUI offer to setl or a aoIldtatlon to buy an,. eeeurttte& discussed The In. formation was obtained from sources we bt'heve to be reliable, but we do not guarantee its BCCUraC. Walston & Co, Inc and its officers directors or emJ'loyees may have an interest In or purehlUle and sell the securities referred to herem. . WNSOI

r ,,',F Wdlston &Co. Inc .—,PILe– INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER September 9, 1966 Q. Mr. President, could you give us your observations on what you think it is that specifically is troubling the stock market A. Jl No . 11 From President Johnson's press conference of Sep- tember 8, 1966, as reported by the New York Ti meso The President, quite obviously, has prerogatives which are denied to market analysts, who are expected at all times to have the answers to all questions. The difficulty at the mo- ment is-that a great many questions are, simply, -unanswerable. – c The stock market has, ever since August 29th, been, by any measurement one cares t utilize, in an oversold condition. As we pointed out last week, however, this factor by itself is of absolutely no help in determining the sho rt-term course of the market. It will be neces sary, first of all, for a rebound from this oversold position to take place and, secondly, for a new pattern to form. This process, quite naturally, takes time and we, therefore, continue to be unwilling to make any guess as to the immediate future of stock prices. We continue to suspect, however, that a great many economic factors, the fear of which has driven stock prices down so sharply over the past six months, may simply not materialize; or, if they do materialize, may already be discounted by present sharply depressed quotations. If this is the case, a great many stocks represent excellent value at the present time. The next obvious question is What stocks Here again the question is at least par- tially unanswerable. We have mentioned the fact that a stocks have reache long-term downside objectives. Let us take two n s and Allied Chemi cal have both reached long-term downside targets tistically cheap, selling at around eleven times f st 29th. Both are stayi ng over 5 and 6, res- pectively. Yet, before either stock moves ,a base must be formed, and there is abs()lute!y .1 s will take,. or of guessing which stock, GM or Allied, will complete it n sta a new upswing first. We are reduced, very simply, to making the the last few weeks, that t ey re e Or, to raise ano e a 0 that we have repeatedly made during oOd\.-lhue to the long-range investor. uestion, what of the glamour stocks Many in- vestors are inclin ues into one category, forgetting that there has, in fact, been tremendous dive it of on between them. Just to cite two stocks in the same indus- try, Motorola was recent own almost 100 points from its high for the year, whereas Magn vox, at Friday's close as trading at about the same price it sold for in February when the Averages made their highs. Other leaders of the 1965-66 upswing have held up equally well. Again, it is too early at this point to tell whether they will eventually resume their upw'J.rd move or will follow their cohorts into the abyss. There are, however, fortunately, a number of stocks where one can speak at the mo- ment with some confidence. These are stocks which broke out of large base formations Just before the market slide began in February, formed only shorter-term tops earlier this year, and have now moved to the downside objectives of those tops and to the support provided by the original bases. One example would be AIR REDUCTION (53 7/8) which, in late 1965, brok out of a trading range between 46 and 60 in which it had held since the 1962 low. The upside objective of this base was 110. The -stock reached a high of only 78 before a short-term top was formed indicating 52. This was the low reached last week. The stock continues to be fun damentaUy attractive, selling at nine times estimated 1966 earnings of 5.75 with every pros pect for bettering this figure in 1967. The 2.50 dividend, which could be raised, provides a yield of just under 5. Another example would be REYNOLDS METALS (41 7/8), recently reached a 10 of 40 1/2, is in a major support zone and where the 1962-65 base mdlcates a long-term po- tential of 94-104. The worst possible downside objective which can be read is 38-36, and the stock certainly appears to be an attractive purchase on any dips. Estimated earnings for 19 are 3.75, and an improvement for 1967 is highly likely since company.will be able to supply more demand from its own production rather than resortmg to profitless sales from government stock pile. Dow-Jones Ind. 775.55 Dow-Jones Rails 194.46 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb ThIS market letter is published for your convemence and mformatlon and IS not an offer to sell or R eoIlcltation to buy Rny eeeurities diSCUSsed. The 1114 formation wall obtamed from sources we beheve to be rehable, but v.e do not gul\rantee lb aCl'urac'o \\-'alston & Co, Inc, and Its officers. directors or eml'loyets may have an mterest m or purchase and sell the seCllTltlcs referred to herem WN.301

Walston &- Co. nl-E- ;' , 1 TABELL'S MARKET INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFfiCES COAST TO COAST AND OVERSEAS LETTER September 16, 1966 For the fjrst time in a good many weeks the stock market was able to turn in a solidly impressive performance on the .upside. ' In six .days the Dow-Jones Industrial Average has advanced almost 40 points, including a l5-point advance on Monday, and a 10-point ad- vance on Wednesday. During the period', daily advances generally outnumbered declines by important amounts and strength in a feature. many better-grade blue chip issues was a welcom As the pattern has unfolded over the past week, the shorter-term technical picture has clarified a bit. At the moment, the most optimistic upside projection one can make for the Dow is somewhere in the 830-835-range ascomparedwiththisweek's intra-day high of 822.93. In order for the base to broaden further, a good deal more backing and filling will probably be required. The overall posture adopted by this letter during the recent market decline should be familiar to our regular readers. Basically, we have pointed out that a grea t many stocks had reached extremely attractive levels at their recent lows, and we have advocated over the past month a policy of buying selected stocks on weakness for long-term holding. With the market having advanced sharply over the past week, we feel it necessary to stress the operative phrases on weakness and for long-term holding, We continue to feel that the market generally could well be in a major long-term bottom area. We still think, however, that there are a number of uncertainties about the immediate picture. In this connection, a study of past market bottoms A glance at a chart book covering the summer of 1962 or, indeed, cover g h period 1946- 1949, will show that a great many stocks continued o;rdo n 10 e ter the Averages reached their bottom. We would not be at all e e' sort of thing occur at the present time. There is, in other words, of issues, especially in some of the more of risk present in a number 'Jrt'g; issues which led the market advance h st' etain-largehold-ings,in these issues might well be advised to utilize ir portfolios of this type of risk element Selection of issues vestor's activity o v h r our Recommended's Account Executive e is e should be an important part of the inn and to this end we have been reviewing stocks in – copy of this list will be in the hands of your Walston In the case of al all stocks on the list, downside objectives have been reached, or approached, and a urther risk appears to be limited. The recent weakness, however, has destroyed the technical pattern on some issues so that recovery action may be rather slow. We are, therefore, eliminating seven issues as follows Chesapeake & Ohio from our Quality & Long Term Growth section; Atchison, Topeka & Santa Fe, Warner Brothers Com- pany, Interstate Motor Freight, Kansas City Southern from our Price Appreciation section, and Budd Company and Foote Mineral from our Speculative Price Appreciation section. It must be stressed that further risk in these issues appears limited, but we feel that upside attraction in other issues may be greater. We are presentl y considering a number of stocks for addition to the list. Among those which will probably p.e in.the near future, are Addressograph- Multigraph and Minnesota Mining & Manufacturing in the Quality & Long Term Growth section; Anchor Hocking Glass in the Price Appreciation section, and Home Oil Class A in the Speculative Price Appreciation section. In addition, those stocks already in the list which appear attractive for new purchase on minor dips, include Air Reduction and Reynold Metals, reviewed last week, plus Chris-Craft Industries, Copperweld Steel, Crowell-Collier & MacMillan, Gillette, Illinois Central Industries, Metro-Goldwyn-Mayer, Olin Mathieson Chemical, Revlon, Robertshaw Controls, Schlumberger, Sharon Steel, Union Camp Corpo- ration, United Fruit and Wallace & Tiernan. Dow-Jones Ind. 814. 30 Dow-Jones Rails 201. 68 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb Thia markt letter is published fOT your convemence and mformation and Is not an offer to sell or 1\ solicitAtion to buy any l!eC!urities discussed. The in. format.lon was obtained,from sources we btlieve to be rehable. but W(l flo not guarantee Its aCcuracy. Walston & Co. Inc and Its officers, directors or eml'loye(!s )nay have an mterest m or pureha..se ani! sell the secUTltll.'S referred to berem WN801 , I Ii , ,d