Viewing Month: November 1967

Tabell’s Market Letter – November 03, 1967

Tabell’s Market Letter – November 03, 1967

Tabell's Market Letter - November 03, 1967
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Walston &Co. Inc. ;….;;…….;;– MUNICIPAL BONDS UNDERWRITERS MUTUAL FUNDS Members New York Stock Exchenge and Other Principal Stock and Commodity Exchangel OFFICES COA,ST TO COAST A.ND OVElSfAS TABELL'S MARKET LETTER November 3, 1967 The stock market gave little evidence last week of wanting to halt its recent price erosion. A drop of over twenty points in the Dow-Jones Industrials during the first three days of the week was temporarily reversed by a 6-point advance in Thursday morning tradin This entire advance was cancelled out in the afternoon,however, to be followed on Friday by a further decline to an intra-day bottom of 853.10 in rather dull trading. Before examining the possibilities for future price action, it is worthwhile reviewin just what has happened so far. The current decline is, quite obviously, the most serious so far in 1967. To date, the Dow has lost almost 100 pOints from its intra-day peak of 951. 57 on September 26th.- Thisis-aaeclineofTO3- Bycontfast;-previousshoitterm declines during the past year have averaged 5, and even the Israeli-crisis decline of May-June cor- rected only 8. 6. The Industrial I ndex has been joined in its downtrend by the Rails, which are off even more sharply, and the Utilities, which are off modestly and appear to Ja ve stabilized somewhat during the past week. Looked at in another way, the present dip is the first one in 1967 that has extended considerably below the low of the previous advance. The last upswing began on August 28th at 887.73, and current prices mark the Dow 30 points below that figure. Indeed, the entire advance from the July 3rd low of 853.21 has now been erased, and something more than one- third of the upswing from the October 1966 low of around 740 has now been cancelled out. Obviously, however, the past is only of interest to the extent tJa t it changes the out- look for the future. In order to get the clearest picture of the future outlook, it is best to examine it from a short-term, intermediate-term and view. The short-term picture, it would seem to of our shorter term indicators are now in deeply app t s . or na y clear-cut. Most the Dow has reached, indeed slightly over-reached, most of its downSide in 0-865 area. Taking the since-broadened pattern, 850-840 is a icult to see much lower prices than this for time being.. may have been seen, or should be se 1 s w..,tmJ. . e.picture.is one.of a bottom that We doubt, also, whe r I – lJ'i.cture is much changed. It calls for, we subscribed to the prop i 0 doom which have emerged from various sources, and we do not thinK 'd te warrants changing our longer term optimism. What the present decline bet c 0 question is the course of prices on their way to new high territory — in other wor he intermediate-term outlook. It is this picture, the one for the next few months, is now least clear. It is possible to view the advance from October 1966 through September 1967 in two ways. The most obvious is as part of a normal upswing that will carry to substantially higher levels without major interruption of any sort. We have inclined toward this view in this letter and we must confess we are not as yet ready to abandon it. The alternative possibility, is, of course, that 1967, and possibly a portion of 1968, might be viewed as part of a protracted trading range out of which the market will ultimately mOve on the upside and advance to higher prices. If this is the case, then the last year has constituted an upward move within that range, while the present decline might well be part of a general downswing — also with- in such a trading area. Whether this trading-range thesis becomes more or less probable Will depend in great degree on subsequent market action rather than past action. The October decline has caused some rather serious technical damage in terms of breadth, volume, etc. None of this damage is so serious, however, that it cannot, between now and early 1968, be repaired. Still it must be repaired in fairly short order if a continued upswing is to be predicted. The burde of proof, in other words, has now shifted to the bulls. In any case, investment policy seems clear. A great many issues, are, at the moment, approaching downside targets and even were the intermediate-term to produce a sideways to downward market, it appears likely that they offer minimum risk at these levels. On the othe hand, if,later in the year, the uptrend resume s its course, the potential for profit could be impressive. Dow-Jones Ind. 856. 62 Dow-Jones Rails 229.74 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb Thla market letter I. published f'Or your convenience and Information And Is not an offer to sell or a solicitation to buy any aeeurltlee dlacllllled. The In- formadon employen wu may obtained from BOurCeII we believe to be reliable. but have an Interdt in or pUl'chaae and sell the 8eeuriti.!'s rweeferdroedptoot guarantee herein. Its accuracy. Walston & Co., Ine. and Its ofBcer.l!l. dlrecton or WNlOl

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Tabell’s Market Letter – November 10, 1967

Tabell’s Market Letter – November 10, 1967

Tabell's Market Letter - November 10, 1967
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W—-a–l-s-tlnocn—&—C–o–. MUNICIPAL BONOS UNDERWRITERS MUTUAL fUNDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges FiLE TABELL'S MARKET LETTER OFFICES COAST TO COAST AND OVERSEAS November 10, 1967 The basic market opinion expressed in last week's letter remains unchanged by the wild gyrations of the past four trading days in which the Dow twice traversed a 25-point trading range. At the low of last week, the Index had reached the 850-840 downside target suggested in last week's letter, and it appears possible that a base will form around current levels. Under these circumstances, with the market down as sharply as it has been since September, prudent investment policy would dictate accumulation on weakness of undervalued groups. One such group might well be the international oils. Not only do current prices heavily discount many of the uncertainties.connected.with.doing.business .in,the .Eastern – Hemisphere, but the consumption of petroleum and associated products within this area is rising rapidly. The importance of the Suez Canal is being lessened by the rush of leading co panies to build supertankers that will bypass the canal and at the same time be cheaper to operate. The three companies discussed below are on our Recommended List. GULF OIL (73) is one of the world's largest petroleum prOducers with operations far flung. In recent years, U. S. -based operations have been contributing the lion's share of net income. However, the company has an ambitious expansion program underway in foreign areas not only to increase production but also to broaden existing markets and develop new ones. To date, this program has proven highly successful, with the effect on earnings notice able. Compared with 4.87 a share reported for 1966, earnings this year are being estimated to rise sharply to around the 5. 50 level on revenues approxima ting 4 billion. As marketing and refining capacities increase more in line with steadily is a more completely integrated organization. As a reflect projecting 1968 earnings to near the 6 a share 0 su llfOduction, the result 1 ustry analysts are s that the current 65 quarterly dividend rate might be the minimum dun e next six months. From the technical view, Gulf Oil an . purchase for a price object- ive at 78, by a high,er()pe 'go .. on the at 65-62. ROYAL DUTCH PETROLEUM Q gh its 600/0 interest in the Royal Dutch- Shell Group of companies, is n oil enterprise. The strong position that it r as hei-e the consumption of oil is in a sharp uptrend, and the highly succ s ex , on development program it has underwal' suggests that it affords the inves t ct' pportunity for capital appreciation over the longer-term It would appear that a bi 'on of lower operating costs, higher product prices and en- larged markets finally turned earnings around. For the current year, net income is esti mated at between 4. t and 4.50 a share, vs. 4.09 last year, suggesting that a modest in- crease in dividend payments is possible. The current indicated rate is 1. 89 a share. Furthe earnings improvement to around the 4.85 a share level is anticipated for 1968. Technically, Royal Dutch has moved out of a year-long base that has built a firm area of support at 38-35. Our price objective remains at 86. CONTINENTAL OIL (76 7/8) is a relatively newcomer to the international field, larlo) gely accomplished through its holdings in the prolific North African oil fields, now accounting for more than 500/0 of total crude production. This has enabled the company to expand its Euro pean refined products marketing where the potential for growth seems considerable. In addi tion, CLL has become a well rounded energy company through the acquisition of Consoli- dation Coal, one of the industry'S largest producers. Moreover, it owns 33 30/0 of CER Geo- nuclear Corporation, formed to develop nuclear explosives for commercial application; the first of which is Operation Gasbuggy, to determine if natural gas flows can be increased through nuclear explosions. Earnings this year are expected to reach the 5.35 a share area up from 5.08 last year, and could approximate 5.70 in 1968. Chartwise, Continental has built a firm area of support at 70, slightly under current price levels. The considerable base that has been built indicates a price objective at 91, followed by a possibly higher goal around 130. Dow-Jones Ind. 862.81 Dow-Jones Rails 231. 70 HARRY W. LAUBSCHER for ANTHONY W. TABELL WALSTON & CO. INC. AWTHWLamb This market letter Is published for your convenience and information Il.nd is not an offer to sell or a aoIleito.tlon to buy any securities dll!lcussed Tb 'eetofeomrpmloaytieoens mwaays hoabvtaeinaeDd inftreormestsoiunrcoers pwUel'chbaeslieevaendtosebllethreehsaebeleu.rlUbuest rweeferdroedntoot hgeuraerina.ntee Its t.ecuraey. Walston & Co.,In.e and Its officera, dir rea IDor- WN801

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Tabell’s Market Letter – November 17, 1967

Tabell’s Market Letter – November 17, 1967

Tabell's Market Letter - November 17, 1967
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– W—a-l-sItnonc.&-C–o-. MUNICIPAL BONDS UNDERWRITERS MUTUAL FUNDS Members New York Stock Exchange and Othp, Principal Stock and Commodity Exchanges TABELL'S MARKET LETTER OFfiCES COAST TO COAST AND OVERSEAS November FILe 17, 1967 After testing for the third time the low around 845 in the Dow-Jones Industrial Aver- age, the market rebounded moderately in the latter part of the week. As we have noted in previous editions of this letter, most downside objectives for the Dow have centered around present levels and the ability to hold in the current trading range is, so far, encouraging. Likewise encouraging is the ability of the Rail Index to hold above its previous low, together with, bf all things, a string of seven con.ecutive higher closings on the part of the Dow Util- ities. One must also put on the constructive side of the ledger the wide fluctuations which have typified the Averages since the present trading range was entered in early November. Such fluctuations are a necessary concomitant of the processofbuildingabase-and, -in two short weeks, enough of this process has already taken place to suggest a possible upside po- tential of 885 on the Dow. All of the above is, of course, highly tentative, subject to change and, in a sense, in- consequential. For example, when the Dow Industrials reached 845 last week, it was the fourth separate time period in recent history when the Index had sold at this level. It moved through this level on the way up in July 1964 at which time one could have bought Xerox (288) at 100, or Consolidated Edison (32) at 46. It touched 840 at the lows of June 1965 when one could have bought Ling-Temco-Vought (120) at 13, or First National Stores (23) at 40. It passed through 845 on the way down in May 1966 when Control Data (142 3/4) was available at 28, and Admiral (20) sold for 50; and it last saw this level in February 1967 when Hilton Hotels (57) traded at 16 and TWA (56) sold r0r 90. All this only emphasizes the roll of stock selection. We are, thus, adding i 0.111 issues to our Reco d The largest dom estic textile producer, BURLING T TR S (41 1/8) has re- bounded sharply from the lows of last year, but con r upside appreciation potential. Earnings this year, en next ember 30th, should show a good rebound from the depressed 2. 30 a s m s t e r the fiscal year recently ende which, in turn, was down from the 3 io ear. With the .textile industry it- fun- more than a year in the -35 0\one at 76. . price objective at 62, followed by a higher Savings & e again being considered by speculators seeking above- average gains. With u tio risk high on the priority list of requirements when consider ing this industry, the s of GIBRALTAR FINANCIAL (22 1/2). come to mind, reflecting its emphaSis on loans apartment houses. Compared with 1. 80 a share estimated for 1967, up about 500/0 from the 1. 19 of last year, industry analysts are projecting Gibraltar's earnings to 2.35 in 1968 and above the 3.00 level by 1970. Supported by a substantial base in the 19-15 area, our price objectives are 48 initially, followed by a higher goal at present not determinable. It is being added to the Speculative Price Appreciation section of our list. Having risen almost 500/0 from the lows of last year, MEDUSA PORTLAND CEMENT (28 3/8) would appear to be forecasting the favorable climate anticipated for the cement and construction industries in general in the coming years. Earnings this year are likely to drop to around 2.50 a share, from 3.01 in 1966, but 1968 should witness a substantial rebound. 1967 earnings were affected by weather, construction strikes and unusually high start-up expenses at a new plant, most of which-are..considered not likely.to recur in 1968. No chang in the current 1. 20 annual dividend is expected this year. With good support evidenced around 25, and a longer-term price objective at 66, the stock has attraction for purchase. Largest of the department store chains, FEDERATED DEPT. STORES (69 7/8) continu to buck the downtrend in earnings being experienced by many retailing units. For the current fiscal year, earnings are estimated to rise to a new peak around 3. 65 a share vs. 3. 54 last year, for the seventh year of consecutive improvement. The recent expansion program is likely to slow down in 1968, but the new year is expected to mark FDS's initial foray into dis counting, a move that could improve profits substantially in the years ahead. Affording a re- turn of 1. 70 a share, and of high quality, this stock has above-average long-range attractio A base of considerable support has been built in the 66-64 area and our upside price objectiv is 90 followed by a higher objective at 124. It is recommended for quality and long-term growth. Dow-Jones Ind. 862. 11 Dow-Jones Rails 230.92 ANTHONY W. TABELL WALSTON & CO. INC. AWTambfTohrml. amtioarnkewt alsettoebrtaIienepdubflrioshmedl5f0ourreyeaouwr e believe tnaI have an interest In or pUFchase an dto6ebla1entdhreeilnieatebotlM!eu,rnlaUteioenrweaefnedrdroe19dntnooot thgeaurnaerinaon.ffteere to aell or a aolleltatlon to buy Ita aceurRCY. Walaton & Co., any Inc. aInltedUirtiUa eoafBdelesrcllu adedlr.eTdhoen In. or WH. . . I

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Tabell’s Market Letter – November 24, 1967

Tabell’s Market Letter – November 24, 1967

Tabell's Market Letter - November 24, 1967
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W—a-lIsntocn.-&–C-o-. MUNICIPAL BONDS UNDERWRITERS MUTUL FUNDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OFFICES CO….ST TO COAST AND OVERSEAS fABELL'S MARKET LETTER November 24, 1967 Last week was one of those in which the doings of the world's financial markets, generally restricted to their own little section in the back of the paper, burst forth in banner headlines on the front pages of the world's press. Over last week-end, of course, Great Britain announced the devaluation of the Pound Sterling. The response of the U. S; stook market, in terms of the Dow-Jones Industrial,Average, was as follows. On Monday, a wave of panicky selling hit the New York Stoc\ Exchange, and, at its worst level during the first hour, the Dow was off more than 16 points, at which price it had returned to the 845-840 level which had provided support on three previous occasions. It was difficult-to-resist-the impressionthat th-eiJulk'of'the selling came from those who had- the least idea of just what, if anything, the devaluation was all about. Throughout the rest of the day a sharp rally prevailed and by the closing, three-fourths of the losses were can- celled out. The rally continued on Tuesday with a 13-point advance and through the first hour of Wednesday's trading. Starting at noon Wednesday, a mild correction cut the day's gain to 3 points. Following the Thanksgiving Holiday, news of pressure in European gold markets caused minor weakness on Friday morning, but the decline was halted in later trading and the Average wound up ahead by 3 1/2 points. Now it is an article of faith with 99 of those who follow the stock market that the market moves in response to news, and it is certainly obvious that the frenzied pace of the weekls trading was touched off largely by the devaluation. Yet, the technician cannot resist noting how often an unexpected news event does nothing more than provide the market with an excuse to do exactly what it was going to do in the first in one sense, a perfect example. This letter lays no claim 'th market was, cience or to privity to the secrets of Whitehall, yet it is interesting f t ast.few weeks have, in essence, followed a technical pattern the outline 0 'ch ear as long as three weeks ago. As an example, let us take ten ue events involved, from a purely technical point of view, in the -t- -Ctownswirig-and to the market action of the past few e!t objective is reached. This occurred when, on he D formed. This took pla e level for the first time. 2 A base is vember and last Tuesday, during which time the Average held betw remes of 872.98 and 839.40. (3) An upside break- out from the base ta ce is had happened by Tuesday afternoon. (4) A test of the support afforded by the kes place viz., the trading of last Wednesday and early Friday. (5) The rally continu 0 its ultimate upside objective — in this case somewhere in the 880-895 area. This last phase, of course, has not yet taken place. It is not, of course, all that simple. For example, it would not be unheard-of, tech- nically, for the Dow to return at the moment to the 840-870 trading range and thus broaden the base in preparation for a wider move at a future date. It would not even be impossible for the Dow to break through the 840 level, thus casting some real doubts on the future out- look. For the moment, however, a short-term upswing must be regarded as the most likely course of events. As this upswing continues, some real questions about the market's future will be raised. Three weeks ago we said…. The immediate picture is one of a bottom that may have been seen or should be seen fairly shortly. We also said … '.' The October decline has caused some rather serious technical damage. None of this damage is so serious that it cannot be repaired. Still it must be repaired in fairly short order if a continued upswing is to be predicted. The present upswing will, it seems to us, do a great deal toward proving or dis- proving the vigor of the market and its ability to repair the damage done in the month of October. The really difficult investment decisions, it seems to us, will be made not at curren levels, but as the market moves ahead and tests the overhead supply which now exists. The final results of this test will probably not be in until early 1968, but a great many clues shoul be afforded by the market's technical action over the next two to three weeks. It is this res- ponse that will be important in trying to forecast the course of the market in 1968. Dow-Jones Ind. – 877.60 Dow-Jones Rails – 231. 31 ANTHONY W. TABELL WALSTON & CO. INC. AWT'a mh Thl. market letter 1& pubUshed for 'OUr convenience eo..formation wu obtained from sources we believe to and information And 18 not an offer be reliable, but we do not guarantee to sell or a aoIieltatlon to Ita accuracy. Wabton & buy any Ine. IleeUrttiei di8cuaed. The inand Its ofBeera. dlreeton or emJflo7ee. m&7 have an inters! In or pupcha.se and sell the securities referl'1!d to herein. WHSOl

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