Tabell’s Market Letter – February 14, 1969

r Walston &Co. —–Inc —– Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER February 14, 1969 INGERSOLL-RAND ( 53 l.. Despite higher labor, material and depreclation costs, the machinery industry is expected to show continued improvement in 1969. Among the more important lssues in this industry category, Ingersoll-Rand stands out as being parhcularly attractive. One of the largest I-R is the leader in the field of air and gas compressors and related equipment, the demand for which still appears to be in a major Ion term uptrend. The product range is broad, encompassing engines, pumps, rock drills, electric and hand tools, paper and plashcs machinery and general mining equipment. The approved merger with Torrington-Gompany 'win-add ,-knitti-ng–a-nd-sew- ing machtne needles, dnll bits and nuts and bolts to the combined product line. While pro- saic in their nature, all of these items are necessary in our economic scheme, and are of particular importance to the construction, utility, mining and service industries. For several years, I-R's earnings have been on a plateau around the 3.80 a share level. 1969 is expected to witness a break away and up from this plateau with current pro- Jections calling for 4.25 a share, vs. an estimated 3.85 for 1968, including Torrington's contribution pro forma for calendar 1968. Further gains are seen for the years immediatel ahead, especially as the benefits from the Torrington merger are realized. Although the increase in outstanding shares will approXlmate 100/0, no reduction in the current 2.00 annual dividend will occur. In fact, the expected earnings lmprovement this year is likely to result in a dlVidend increase. The decade of the 1970's is expected to prove to I-R. Demand for its products should help management reach its goal dou 1 g earnings over the next five years. Selling for less than 13 times this en imate and providing an above-average industnal Yleld, the shares merit ideration. Technically, IR has formed a base ngth in the mid-40's that in- dicates a price objective at 88, near 100. There is good support at 48-44. IR is on the PnceApprec' owc oUr Recommended List-.– — – CENCO INSTRUMEN … nursing homes, hospitals and hospital supplies and equipme t fastest growing m'u 1 even think of Cenco. And yet, lt is one of the les in this health field. Its product line runs the gamut from production ana s ibu i f scientific and laboratory equipment to hospital beds and furniture,and includes te' disposable items for operating rooms. teaching aids and schoo accessories, water p lOn abatement equipment, gymnasium seating and locker room equlpment, graduation and church choir apparel and owning and managing hospitals and nursing homes. The company is maktng significant strides toward reaching its goal of owning or leasing more than 24 hospitals and nursing homes by 1971. Last July lt purchased two Los Angeles hospitals and announced plans to build two additional facilities in California. It recently purchased a 320-bed facility in Orlando, Florida. Its own subsidiaries will supply the furnishings and much of the required equipment. Earnings for Cenco have increased every year since 1953, an envlable record in the glamor-stock field. For the fiscal year ending April 30, 1969, net is estimated to reach 1. 95 a share, compared with 1. 76 for fiscal 1968. Some analysts are projecting a dou- bling in earnings by 1973. The dividend, now at 30 annually, is expected to parallel this anticipated rise in income. Technically, the Cenco chart reveals an area of extensive backing and filling in the 55-45 area that has created a base suggesting a price objective in the mid-80's. With good support at 58-54, CNC also is recommended as a purchase for Price Appreciation. Dow-Jones Ind. 951. 95 Dow-Jones Rails 275. 72 HARRY W. LAUBSCHER for ANTHONY W. TABELL WALSTON & CO. INC. AWTHWLamb Thhl market letter 18 published for )our convenience and mformntlon nnd IS not an offel to sell or a soliCItation to buy Il.n) securities UISCUSSed, The in- fonnatlon was obtalned,from sources we to be rehable. but we do not sroaralltee Lts accurnc). Walston &. Co.. Inc. and Its officers, dLrector. or employees may have an mterest In or purchase and sell the securities ref('rred to heLem WN.801