Tabell’s Market Letter – September 26, 1969

Tabell’s Market Letter – September 26, 1969

Tabell's Market Letter - September 26, 1969
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Walston &- Co. —–Inc —– Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OYER lOD OFFICES COAST TO COAST AND OVERSEAS l,ABEll'S MI ARKEl lETTER September 26, 1969 il PITTSTON COMPANY (65)…… Can you remember the last time you saw a load of coal being delivered Very few households today use this fuel for heatmg purposes and most people would think the coal business is a dying business. Quite the contrary' Especially for Pittston Company, one of the largest distributors of coal and a diversif1ed holding company in its own right. In fact, earnings have been in an impressive uptrend for almost ten years, rising from 1.64 a share m 1959 to 3.38 last year and an estimated 3.60 to 3.70 for 1969. Despite the favorable trendto.date, the.outlook e impressive. While volume should benefit from increased capacity in coal operationS, favorable trend in oil distribution facilities and a good level of steel operations on the part of steel companies, the main point of attraction is the fact that escalation clauses in certain of the company's coal contracts are combining with increased sales of more ex- pensive grades of coal to indicate an impressive Jump in earnings potential for 1970. Current esti;nates of earnings for next year now approximate the 5.25 to 6.00 a share range, a gain that 1S larger than the total gams of the last seven years. ' Pittston also is an important factor in the trucking industry through its U. S. Truck- ing and Brink's, Inc., subsidiaries. Brink's furnishes armored car services in 132 cities as well as overseas. The company also operates 31 terminals in addition to barges and tankers. Nine of these terminals have facilities for could become important in connection with Alaskan oil. W tankers, which 0 Technically, Pittston has formed a broad and one-half that suggests a price objective with a higher goal readable at 90. There limiting downside risk. Now being to e –mended.!ist,-PittstonGompany.sha'l'- 54 over the last year 10 mid-seventies, and CO in the 62-58 area, ice preciation section of our recom- d e d – f o r – p u r c h a – s e – a t – t h e – m a – r k e t – – .- – – 1 ' 1 UNION CARBIDE ride that has characterized common shares of the Union for the past decade appears to be nearing an end as prospects for mcreasingly favorable. Earnings this year are ex- pected to reverse til ntr that started in 1966, thanks to recent pr1ce increases on low-density polyethyle e several other chemical and plastics items. It is in the can mer area that UK has been showing much of its recent zip. Disposable plasttc Glad bags and wrap are doing especially well, while consumer response to the Eveready line of batteries, particularly the new longer-life types, remains quite strong. The cold weather season is coming on rapidly in'some parts of the country and the well-established line of Prestone antifreeze is expected record a new sales peak this winter. On top of all this, operations at the huge new petrochemical complex in Louisiana, have improved to the point that margins actually have been helped. All this contributes to the more favorable outlook now being held for Union Carbide. It also is being reflected in actual earnings. Compared with 2.60 a share last year, results for 1969 are being estimated at close to 2.90 a share, with a jump to well above the 3.,00 level anticipated for 1970. No incr,ease in the current 2. 00 -annual dividend. is likely during the coming twelve months. Technically, Union Carbide has been building a base for two years that indicates unusually strong support in the 42-40 area. This same base also enables a price objective to be indicated, initially in the 52 area, followed by a higher reading at 65-70. Now being recommended for purchase, Union Carbide is added to the Quality & Long-Term Growth section of our Recommended List. I ANTHONY W. TABELL-HARRY W. LAUBSCHER Dow-Jones Ind. 824. 18 Dow-Jones Rails 199. 54 WALSTON & CO. INC. AWTHWLamb This market letter is pubhshed for your convenience and IDformatlon and IS not an offer to sell or a soliCitation to buy Bny seeUtltles diSCUSsed The in- formation was obtained from sources we believe to be rehable, but we do not lrUarantee Its Walston & Co. Inc and its officers. dn'ectors or employees may have an Interest In or J)UFchfUle and sell the Si!CuntllB referred to healn WNBOl 'ill , ,J ,

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