Viewing Month: March 1970

Tabell’s Market Letter – March 06, 1970

Tabell’s Market Letter – March 06, 1970

Tabell's Market Letter - March 06, 1970
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Walston &Co. Inc Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST ANO OVERSEAS TABELL'S MARKET LETTER March 6, 1970 After extending its advance through early Thursday, the market ran into mild profit- taking and declined slightly in late Thursday's and Friday's trading. This action was hardly surprising considering the fact that sharp rise had left most indicators tn a somewhat overbought position and that short-term objectives on the popular averages had been reached at the mid-week highs. Expected action at this point would be a period of backing and filling at, roughly, the 780-800 level in the Dow-Jones Industrial Average. Ability to broaden the present potential base in that area and to then resume the advance would be constructive — probably ind1cating that the 1969-1970 bear market had finally been laid to rest. While to the market, trading in the first two months in 1970 has brought about an umisual divergence -in indiv1dual stock patterns-.– A -great many of the issues which defied the bear market have formed potential tops and look as though they migh finally receive their comeuppance. Meanwhile, issues that posted major bottoms last July, and have been basing ever since, now appear to have an upside potential which far outweighs their downside risk. One such issue is reviewed below. Current Price Current Dividend Current Yield Long-Term Debt Common Stock Sales-1970-Est. Sales-1969 LOEW'S, 34 3/4 0. 13 1/3 0.40/0 590,000,000 14,438,263 shs. 800,000,000 554,000,000 Earn. Per Sh. 1970-Est. Earn. Per Sh. 1969 2.75 1. 83 1. 71 INCORPORATED Ten years makes a big difference in the life of an firm and in the life of Loew's, the last ten years have made an enormous difference, for the better. During the early part of those ten years, the com pany underwent si changes centering around the buil n theaters f!fl ho e s. ining and operating of e ently, Loew's inte- rests d new fields consumer products . ding. I d, oducts area, the merger with er of Kent Cigarettes and other -MkCRange-1969-'r970-' the country. This products in future. ws fitcient introduction of further new consumer s me active in home building in a big way. Construct- ion of three new co o already is underway in West Los Angeles, South San Francisco and Yorba 'n a, 1fornia, and plans are tn progress for the development of several more, inc1udin recently announced for a community development on Staten Island, New York Cit . This would appear to be excellent timing on Loew' s part. Residential construction has been drastically curtailed in recent years due to high mortgage rates brought about by tight money. With interest rates likely to head lower in the months that lie ahead, a strong pickup in construction is anticipated. The demand for new homes is at a peak level and is not likely to be satisfied until the late 1970' s. This strong position to produce and market a wide variety of goods and services, such a entertainment, foods and beverages, consumer products, transient lodgings, and permanent housing, yonsiderably broadens its earnings base. In a well-defined uptrend in recent years, earnings are expected to advance even more dramatically in the years immediately ahead. For the fiscal year ending August 31, 1970, net 1S estimated at 2.75 a share, up from 1.83 last year (1. 71 fully diluted). Revenues-will advance sharply to around 800 million, from-' 554 milllon last year and 166 million the prevlOus year. Most of this improvement stems from Lorillard. . d. Although health scares are likely to recur from time to time, the long-term trend on ci- garette sales appears to remain upward. Sizeable savings should result from cessation of radio and TV advertising as of January 1, 1971 and the leading brands at that time, of which Kent is one, should remain leaders afterwards since competitors also will not be allowed to advertise except in printed material. When radio and TV advertising was halted in England, sales continued to move ahead and were not affected by the prohibition. Technically, an area of congestion has been formed in the 30-40 region. This base indicate an upside potential of 46-54 w1th a longer-term goal readable in the mid-60's. On the downside there is good support at 32-28. Already in the Price Appreciation section of our Reco mended List, Loew's, Incorporated, is again recommended for purchase. Dow-Jones Ind. 784.12 ANTHONY W. TABELL-HARRY W. LAUBSCHER Do– — – . . Is ar C lttl'r 15 ))U 1 or coovenlPnre 'l.ntl lIlformn1ion an,1 !lot lin offl to sell or ,\ t.l buy ,Ill) -''I'urllu, (1I.,('u,,.I The In- formation wns obtained from sourctf, we lwhcH' to be employee,\ may have an mtereBt Ln or purchru,.. ,Lntl st-1I the hut we do Ilut J.,.Ultr,ll1tce It!. l\(curac) W I.ton &. Co, lor nnd lts officerll, dLrectors or r('l red to hcr(Ln.

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Tabell’s Market Letter – March 13, 1970

Tabell’s Market Letter – March 13, 1970

Tabell's Market Letter - March 13, 1970
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Walston &- Co. —–Inc —– Members New York Stock Exchange . and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER March 13, 1970 The best way 'of getting the right answers is to ask the right questions, and this is as true of the stock market as anything 'else. Ofttimes one stock market question will be un- answerable while, at the same time, the answer to another question is quite clear. The pre sent is a case in point. One way of viewing the stock market is to ask whether the popular market averages are about to go up or down. This question, unfortunately, is not one which can be answered with any degree of certainty at the moment. As we have pointed out in recent issues of this letter, some constructive developments have taken place in tlie past few weeks. The intermediate- termdow-ntrend-f-rom-the-November high of 8'71. swing from the January 30th lows remains in effect, and the correction of this short-tenn advance has so far been orderly and characterized by relatively light volume. On the other hand, short-term objectives have been reached and most market averages are now in an are of heavy overhead supply. As we have pOinted out repeatedly in the past, it is going to be the market's reaction to this supply which will determine the direction of the next move. If we persist, therefore, in simply trying to guess the market's direction, we are un- likely — immediately at any rate/– to get a clearcut answer. If, however, we ask another question, i. e. '. where is market/leadership going to come from and what sbcks are likely to be the best ones to own for mid-1970 — recent market action has been providing us with a rather decisive answer. Fornalysis of individual chart patterns points clearly to the con- clusion that we are entering one of those phases of changing leadership which periodically characterizes the !parket. Lrt us see if we can 'blittle bit further. 1969 was, as.no one needs to be told, a rather poor r et, for a great many stocks, the 1969 bear was non-existent. e a Ie, at 290 in early 1969 and above 380 in January 1970. Other computer stoc d eve re dramatic advances,and similar performances werl not uncommon s supply, franchising and other industries. The applicabll investment cliche e ain performance became visible -.-. -earnings-growth-. . ,),e -of-uncertainty-for -the-economy,and th companies to own, were going to grow almost under any conceivable se't oVec rtomi 1 The concept has e fine thing, but at ! e 'n overvalued in relati/o 0 the 't a ed of late. First of all, earnings growth is a very .n e issues with the fastest-growing earnings can become cks. Secondly, as a number of fourth-quarter reports have shown, some of ear i growth which was so obviously visible in 1969 has become, all of a sudden, inviible ,indeed, non-existent. The end of the infatuation with growth-at- any-price is be,bming manifest in the technical patterns of a great many issues and, as was pOinted out last/week, many stocks which advanced sharply in 1969 have not only declined dramatically ffom their 1970 highs, but also appear vulnerable to further price erosion. MeanwhIile, clues as to new market leadership begin to assert themselves. The shape of the 'economY for, 1970 is beginning to emerge ever more clearly. We are, qUlte obviously, in the midstl6f the fifth post-war recession, and it will, at some point in time, be character ized by easiIer ' conditions, lower interest ratell, and, ultimately, a business recovery. In prospeci' of the' recession, a great many stocks have been battered down to levels which re flect not otuy pos(lible lower earnings, but disaster which is highly unlikely to occur. Thtis, we 4ave phenomena such as the following; the Dow-Jones Utility Average, bat- tered by/high interest rates in 1969, advances on the recent recovery, roughly twice as mue as the Dow-Jones.Industrials. U. S. Steel, down 33 in 1969 to a 10-year low, suddenly stage a 25 advance. Savings & Loan issues, obviously beset by savings outflows and other well- advertised troubleis, become the leaders on the upside in the recent rally. 'The thrust has quite clearly shifted in recent months from those issues wit sustained growth patterns to issues which could do well in conditions of economic recession, or which have battered down to ridiculous levels in anticipation of that recession. It is from these areas that 1970 stock market leadership is likely to emerge. 7tp.Dow-Jones Ind. 11 ANTHONY W. TABELL WALSTON & CO. INC. Dow-Jones Trans.J 173.21 AWTamb f ThiS market letter IS )OUt convemence and mformlltlOn Ilnd If not an offer to !'lell or !\ I0h(,lwtlon to bu) .my ..'('unt.le! ,hqCUM,cd The In- (ormntlOn was obtained fran \\,c beheve to Le rehabl!', hut we do not guarantee Its i\('curnrv Wnlslon & Co., Inc, nn,1 119 Omr!!19, dIrectors or L.f!.1/11employees may have an mtet'St 11'1 or purchase and sell the nfcrred to hereIn . . WN.SOI t

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Tabell’s Market Letter – March 20, 1970

Tabell’s Market Letter – March 20, 1970

Tabell's Market Letter - March 20, 1970
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Walston &- Co. Inc Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER March 20, 1970 Dullness continues to characterize the stock market. The short-term decline from the March 4th pea k halted last week, but the market was unable to generate any steam on the upside and volume continued at its abnormal low level. Despite the apparent dullness, however, below the surface important changes are apparently taking place. As noted in last week's letter, we have reached one of those periods of shifting leadership in which the di- versity of individual stock patterns is unusual. Accordingly, we are beginning this week a review of major industry groups with a summary of the technical picture for the group as a whole, and comments on a few of the stocks therein. We will continue this review in sub- -sequent letters until it is-completed. . AEROSPACE. This group has been in a 4-year downtrend which, in most cases, shows little signs of being arrested. We would continue to avoid major issues in the group at this time despite their apparent cheapness. AIR TRANSPORT. Most issues moved down along with the market throughout 19691970, and continued to new lows last January. Tentative signs of improving technical action are apparent, but we would be inclined to defer purchase in most cases. Delta Airlines (33 1/4) appears potentially interesting if a successful attack on the heavy overhead supply at 36-39 can be mounted. ALUMINUM. The group moved in line with the market during the first half of 1969, but more recent action has been constructive with three of the four issues holding above their July lows in January. Not only are the potential bases formed since July sizable, but previously existing long-term bases also indicate higher f!lA w8uld consider Alcan Aluminium (261/4) and Aluminum Co. of America (67 1/2) 2),and Reynolds Metals (33 7/8) all buys on weakness. AUTOMOBILES. By and large the group look l enou recent levels, but we think more basing action will be required, 40-47 area for Ford (44 1/4), and the 65-75 a .. -AUTO ae level for Chrysler (26), the r G al Motors (705/8). OiigJ1-fl1ere have been some outsfafid ing individual issues. Some where ability to reach 33 woul e s in Champion Spark Plug (253/4) in Dana Corp. (24 1/ 4) where the upside breakout would be 27. BEVERAG – . ' as been one of the outstanding groups of 1969, main- taining a continuous r d 1 face of a sharply falling general market. We would con- tinue to hold most issu s, ough our favorite for new purchase remains Rheingold (29 1/2). BEVERAGE-D LERS. General group action continues uninteresting and other areas probably have more attraction. BEVERAGE-SOFT DRINKS. Another area that has been resistant to the general mar- ket decline. Both Coca-Cola (79 1/4) and Pepsico (52) can, in our opinion, be purchased on weakness. BUILDING. Patterns vary among different segments of the industry. In the Air- Conditioning group, Trane (66 7/8) appears attractive while Carrier (37 1/8) could also be basing. Cements are among the most attractive sub-groups in the industry with Alpha Port- land (19 3/4) and Lone Star (23 7/8) having the most interesting patterns at present. Heating and Plumbing issues look generally dull and should probably be switched into other issues in willthe building area. The Roofing and Wallboard stocks have reached downside are starting to base, but more time probably be required. – — and CHEMICALS. Again a broad diversity of patterns. The heavy chemical companies generally appear to have little downside risk at present depressed levels, but equally little immediate upside attraction, and we would be inclined to seek capital gains elsewhere. A fe interesting exceptions to the general downtrend are in the Industrial Gas field where Air Products (40 1/4) and Big-Three (40 1/2) are interesting, and in specialities such as Cabot Corp. (34 1/2), Clorox (225/8) and Koppers (41 1/2). COAL. Another group which was outstanding last year and still appears headed higher. We would hold major issues. Dow-Jones Ind. 763.66 Dow-Jones Trans. 170.75 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb This market letter IS published fO/ )'Qur f'OnVelHNllC .and mformUf)D ,mIl ); not Jln ITt tv ell or …. .oht'llatlon to buy Jill) dlscu;5'd The in formatIOn obtaIned fr,)m &ourt't.1 we to be hut we ,10 not gu rantC't. Its .Ircuracv Wl\lston s… Co. Inc lntl It., officers. dlr(''wrs or entOloye'l mny have An Interest In or purehn'lc ,mil sL'll the Itl I eft'J t .(1 t6 hCrCltl — II

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Tabell’s Market Letter – March 26, 1970

Tabell’s Market Letter – March 26, 1970

Tabell's Market Letter - March 26, 1970
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Walston &Co. Inc. Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges O …. ER 100 OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER '- March 26, 1970 The long awaited break in the prime rate this past week brought an immediate,favorabl res)onse from investors. While some near-term weakness is anticipated, it seems that the worst now is over and that the great bear market of 1969-1970 is either already dead or dying. Last week we started a review of mdustrial groupings, highlighting various situations This is continued this week. The market climate now merits strong consideration on the buy side by investors seeking well defined appreciation in the months and years that lie ahead. CONTAINERS-l\IIETAL & GLASS. Glass issues generally look lower under the threat . '5f/pOEfsible-legiSlatlon- against CiinI40-71S) has-reaclieira-down'- side objective, b\lt basing in the 36-44 area probably will be required. Continental Can (73) remains in the confines of its longer-term uptrend and should be held. CONTAINERS-PAPERS. The long range downtrends continue and other areas would appear to offer more attraction. COPPER. Recent technical action of this group makes it one of the more interesting industries currently available. Relative strength has been improving since mid-1969, and Phelps Dodge (53 3/S),Kennecott (51), American Metal Climax (37), and American Smelting & Refining (35 1/2) all have upside object ives considerably above current levels. Even Anaconda,(29 3/S), the worst acting issue in the group last year, has fine recovery pros- pects. Producers-price stability for 1970 appears assured despite recession prospects and most major issues are relatively cheap with tremendous yi COSl\IIETICS. Although the group displayed outstandi s h guring 1969, some topping action is apparent and profit-taking should bani e m e of these stronger issues. Faberge (26 5/S),on our Recommended List ece ak, is at strong support. DRUGS. This group, which put on a Ie ormance during the second half of 1969, has been meeting with resistan t rthe side progress recently, suggest- ing that a period…Qf con.olidation .. Jl.-!Jave formed in several leading issues, such as Merck ( 104) pected. m),andfurther proflt taking could be ex- ;, ELECTRICAL P D c s have been common throughout this group in re- cent months, brin . ie n into areas of strong support where they again can be considered for in 0 such issues are Singer Mfg. (79 1/2), on our Recommen ed List, and Westingh se ctric (67). f ELECTRONIC L ERS. Weakness continues to characterize this group with most issues showing only attempts at stabilization. A period of backing and filling is necessary before substantial upside movement can be accomplished. While it is possible to read some what lower objectives for issues like International Business Machines (3331/4) and National Cash Register (140 1/2),the upside objectives for both issues remain in force and they con- tinue on our Recommended List for investment purposes. FINANCE COMPANIES. Basing operations have been going on in this group for the last few months, suggesting that the worst probably is over with. However, further evidence of definite improvement in the monetary picture is needed before significant upside progress can be expected. The same can be said for the SMALL LOAN COMPANIES which have started to show signs of improvement but which have not yet given buy Signals. ., FOODS. On balance, the charts of companies involved in production/processing and/or distribution of food products show a rising trend. This is particularly evident in the charts of Kraftco (40 3/S), Heinz (36 3/4), Campbell Soup (35 l/S) and Swift (31 1/4). These are of investment stature and can be considered during periods of weakness for pur- chase. Readable upside objectives are considerably above prevailing levels. DOW-Jones Ind. 791. 05 Dow-Jones Transp. 173. 2S ANTHONY W. TABELL-HARRY W. LAUBSCHER WALSTON & CO. INC. AWTHWLamb This mnrkct kttcr IS iJuhllsh …d (or your lonvcmenrc nnri Inform.lt)(JII uwl not all otri'l to or ,\ ROliILltzon to buy 1111) l'Ccuntics The m- formatIOn ohtluned from we Iwill'\'( to he ijll.Jhle, hut W(' do not JnMItntee Its lll'eUn'lC) Wnhton & Co, Inc. and It'! officers, dlrC(tors or employees may hnvc nn mtereot In or pun-hase Im,j the o;c.untl.1 r.ferrei to herem WN.sOI

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