1 W—-a–l-s-Itnocn—&—C–o–. Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND OVERSEAS lABEll'S MARKEl lETTER May 15, 1970 . The market made its most convincing attempt so far to reverse the long decline at the end of last week. After four consecutive days of plunging to an intra-day low of 673. 51 on Thursday, the Dow rallied eight points in late Thursday trading, followed this with a further rally at Friday's opening, and then, after losing most of its gains, advanced sharp- lyon heavy volume late Friday afternoon, cracking back through the 700 level to an intraday peak of 705. 58. We confess we have a bit more confidence in Thursday's bottom than in the others which preceded it. There are a number of positive factors. First of all, the rally took -place from an area, 690-680,thatwe point.foI' the Dow. This area is the bottom of the long-term downtrend channel that has character- ized the average since the 1968 high. With prices scraping along the bottom of that channel, it was possible to view the outlook with a good deal more confidence. Secondly, there were abundant signs, as the Sickening decline continued in the early part of the week, that the panic stage was being approached. Odd lot short sales increased hearteningly and other signs of weak short selling abounded. When, after a 300-point drop in the Dow, specu- lators suddenly discover short selling as a road to riches, it can only be interpreted as encouraging. Nonetheless, a few caveats should be notf'd. Even assuming that Thursday and Friday's action constituted a climactic bottom, it lS, generally, true that the initial climactic low is not the final one. We would not, in other words, rule out a further drop to new lows following an extension of the rally. 0 Although, obviously, it is too early to see whether Ii ecline has been reached, we do not think it is too early to look t m ry to make some conjectures about the stock market climate once the ket fi y turns. All too many investors, we are afraid, will go back to oc nd techniques with which they did so well in 1967-1968 despite the 's e isi pan them in 1969-1970. And, thereby, they willinevitably'come -e us e-clirilate-of to return — probably not for quarter-to-quarter ear ings 1 of the hot story, of emphasis on nt, technilogical mumbo jumbo, of fast-buck accounting and of sp pitalized issues with no real market is dead, dead, dead, and it will re it rises again from the ashes. We even thinK' p ob hat, while the second half of 1970 should undoubtedly pro- vide a better overall . climate than the first half, that a number of issues could be subject to still furth rice erosion. Let us emphasize this point by tracing the recent history of three averages, the -Dow-Janes-Industrials, Standard & Poor's 500 and the American Stock Exchange Index. All three industries made major peaks in 1966, the Dow of 1000, Standard & Poor's at 94 and the American Stock Exch,ange Index at 17. The Dow subsequently declined to 735, the Standard & Poor's to 73 and the Amex Index to 12. The percentage drop was least in the Standard & Poor's and about the same on the Dow and the Amex. On the ensuing advance to the 1968 highs, the Dow barely recovered the lost ground reaching a high of 995. The Standard & Poor's, by contrast, advanced some 48, recover- ing 170 of the ground 10 st. The Amex Index, by contrast, spent the two years from 1966- 1968 going wild, advancing to 33, an 175 advance to almost twice its 1966 high. At the moment, the Dow has declined 29 from 1968, the Standard & Poor's about the same, and the Amex, predictably is off almost 40. However, to the sharp early advanye in'the latter two indices the Dow is slightly below its 1966 low, the Standard & Poor's 500 just above it and the Amex Index still is some 66 above its 1966 bottom. Now it is at least possible to raise the question whether, if such stocks as General Motors, du Pont and U. S. Steel are today worth less than they were in 1966, the average speculative issue represented in the American Stock Exchange Index is worth two-thirds more than it was four years ago. What we are suggesting is that the price vulnerability of this sort of issue could continue even in a projected better market climate. All of this, of course, is just another rationale for our emphasis of the past month on quality issues. We think that the average high-grade stock is now selling for bargain-basement prices and that ownership of the,se.stocks will lead to investment in the new climate of 1970. Dow-Jones Ind. '702.22 ' Dow-Jones Trans. 147.66 ANTHONY W. TABELL WALSTON & CO. INC. This market letter Is publlshed for your con.. emence and mCormlitlon lind IS not an offel to sell 01 II. solicitation to buy any dISCUSsed. Th I formation was may hoabvtaeinaend from mtere8 sources t In or we belie PUl'chase vnenato be rehable. but the securltl(s we ref edrroedntoot guarantee hetCln. Its accuracy . Walston & Co Inc … and Its ffi 0 cere, dl t ree o' rtl onr Aw Tmn WN.''' . .,,, a i , .j

r Wdlston &Co. —–Inc —-Members New York Stock Exchange and Other PrincIpal Stock dod Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER May 22, 1970 There is very liftle-new to say after a week like the last one. The stock market continued its plunge with the Dow-Jones Industrial Average reaching an intra-day low of 653.27 on Friday. Once again the slide was punctuated by rally attempts in- cluding two on Thursday, one Friday morning, and one late Friday afternoon. Buying, however, failed to stem the persistent price erosion. The persistent question, of course, is Why. The New York Times informed us Friday morning that the decline was due to a lack of confidence. It is, we suppose, as good an analysls as any. There is hardly change in the economic picture over the –past -year and ii-halfsufficieiino maKe comriloi'iStocksin the 'aggregate worth' shine ,. 250 billion less than 18 months ago. Yet, it might be worthwhile at this stage to try to pinpoint this so-called lack of confidence. Whence does it arise and how real are the fears First of all, Cambodia. Now, quite obviously, as underscored by the traglc dis- sension in the streets of late, there is room for a great deal of difference of opinion among honest men as to how and how fast we should extricate ourselves from our Southeast Asia entanglement. We do not intend to intrude our own opinion here, 'yet the fact remains that the movement of the fighting front some 21 mlles west has evoked a response on both sides worthy of a combination of Bunker Hill, Fort Sumter, the Lusitania and Pearl Harbor. A more sober view would indicate that, at the beginning of April, we were bogged down in a nasty war from government's avowed intention to remove us and, at the end of May, t s t seems to be, at wors1; no different. (0' ;, Coming closer to home, of course, we are d market fears a recession. This is hardly news. We have been 0 eaders' attention to it in this space for . t.he .pa.st six months and '\imYe yone, with the unfortunate . of econ tos in Washington, is aware of its existence. However;–it is that-the current level of stock prices has bUilt-in a f far more pessimistic than anything any responsible econo Ie envision. Inflation A i 1)f, ; ,,-e ence of rising prices into April in a period of declining busines e ( pointing. And yet, it must be asked, is this anything more than a demons atlO the tenacity of inflationary expectations fueled by a two-year policy of de' race expansion Now much is m e of the stock market's repute as a forecaster and, indeed, it has been uncannily accurate in this regard. However, it would be more true to say that the market anticipates possibilities. The market has declined prior to every business contraction in the post-war period simply because it recognized the possibilities of such a contraction's occurring. It has also declined in the past, when investors feared events that, in the future, did not actually occur. The 1966 decline was widely attributed to fears of a recession that never occurred, and, of course, the whole 1946-1949 drop, producing the on!y period in recent history when prices were a great deal cheaper than they are at the present, was due to the certainty of a post-war depression which, of course, never happened. At the moment, we have just undergone the most-severe decline of the entire post- war era. Stock prices obviously anticipate a good deal more than a mere recession. What Depression Chaos in the streets An extension of the war Repression Possibly all of these things. What seems important at this point is for the investor to try to asses as rationally and coldly as possible the probabilities of each of these disasters coming to pass. They all, admittedly, are possibilities. If they were not possibilities, it is highly doubtful that the Dow-Jones Industrial Average would be where it is today. It is only worth remarking that the most profitable opportunities to purchase common stocks have in the past occurred when prices reflected potential disaster which did not come to pass. Dow-Jones Ind. 667. 58 Dow-Jones Trans. 140.98 AWTmn ThIS mnrkct ;1'IS Iluhhh…d for )')UI ('onH'n!lIllC ,lnll ,nrO'Ill . mI,,, not ,In ofTel to ..Il 01 rnun.Lllon ,. oLLl'tln(,,1 11m -.ou!t W(' 1 1 I- lo 10 1.11 -1,1. -,l,t WI' do nut gUllolTlll'l Ihl ('mnloYI',; mny havl.' lin IlIttlcat III 01 IIUll'h.ls 'Ifill sell the lefl'fll,i to hl.'ll'llI. ANTHONY W. TABELL WALSTON & CO. INC. 'o1i(,It.lt\on tAl /HI) w,utilles fh'Cu.,s('d The in- \\'j.,tnll & CU. JU(' an,l It., I,fficl'r'l. ulll''wrs or WN.301

( Walston &Co. Inc Members New York Stock Exchange and Other Principal Siock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND QVEASEAS TABELL'S MARKET LETTER May 29, 1970 Last week's market performance was, at once. both typical, and yet, historically without precedent. The market's mood turned almost simultaneously at mid-week from one of unchanged pessimism to rampant optimism, and what had been one of the steepest declines of recent years was transformed into the sharpest rise ill three decades. The week began with another sickening 20-point slide in the Dow to a low unmatched since early 1963. On Tuesday, the decline continued with the Dow slowly eroding by 10-points to an intra-day low of 627.46, a figure which may yet achieve historical stature as the low point of the 1969-1970 crash. Despite the down Earket, Tuesday's action had -in it the fir-stseeds.of.a reversal as.1'7-million hands, up from 12. million in Monday's trading. What obviously was ta.klllg place was that the selling wave was being met by bids of considerable size. Wednesday's market was the inevitable climax, a 32- point rise in the Dow, the largest on record, again with 17 minion shares trading. Then, almost unbelievably, the ad\'ance was furth'r extended on Th11rsday ith a 20-point gain and yet further extended on Friday as tle Do'., crashed back through 700 in a 16-point ad- vance. As we said above,' the performance WdS, in one sense, typical. It is not being overly blase to say If you've seen one selllllg climax, y,ru've seen them all. The ingredients were all there, the slough of despond. the plunge to new lows, the pickup in volume, and, finally, the abrupt turnaround. Major downswings have ended this way in the past and they will end this way in the future. Yet, in another sense, as we said, this one was There were those who, at week's end, were shrugging of he without precedent. rl.ance as a typical technical rally. This seems to us the worst sort orrae1P i i i . e rally was, on a demonstrable basis, the strongest short-term upW! of e re post-war period and of a type that, inevitably within that ha n a iated with major market bottoms. It would be the height of folly to this c -cut message. .- Let us ce was 5. 07'on'the-Dow-and-a- '.– similar amount on the S & P of a similar magnitude has occurred since 1940. There have, occasions in the post-war period when a one-day advance in I t n place each one of these occurred at the terminal point of a major , and 1962. Over a two day period the Dow advance 8.4 and the S & .'. . his figure IS totally without precedent. To add one fur- ther statistical note, '\'n r .esday, 1312 issues or 80.5 of all issues traded advanced. This is a record fer tl. ost-war period and again, historically, an advance ratio in ex- cess of 75 has finaLy in the past been associated with major bottoms. Now, before we are taken to task for hav'll1g an unduly short historical prospective, we will admit that all of the above figures refer the post-war period only. There were, admittedly, a number of sharper one and two-day reve!'sals throughout the J' s. How- ever, it is also true that, durmg the 30's, the downswings tended to be a great deal sharper. We thlnk, at the y,),oment, it would be dangerously unproductive to assume that -the game is being played by the rules of the 30' s rather than those of the present day. I It is, in s1)y,),mary, our judgment that the effective bottom has been reached. The use drthe word effective is calculated. It would not be wihout precedent for the mar- ket to move back to or through the old lows Indeed. In every base formation that has occurred in the past, a testing of the lows has taken place and in some cases, June, 1962 being a typical example, that test involved the penetration of the former low by a signifi- cant amount In most such cases, howeyer, better- grade issues have stubbornly refused to move back to new low territory the second time around. It is highly probable, in other words, that a significant number of listed issues saw their 1970 lows at last week's prices. Quite obviously, some consolidation will be needed, and a rally which has now extended 70 points in three days cannot be extended ind(!finitely. We think the message of the rally, however, is clear-cut and investors should pay careful attention to it. Dow-Jones Ind Dow-Jones Trans. AWTat 700.44 144.46 ANTHONY W. TABELL WALSTON & CO. INC. ThIS rnnrktt l… IS fur (.llr ,'onv('nWl\r( '\1\,\ L,,(Otnmtwn !Iud h not un ,,\, , 10 it'll rot t \Ltt.ltm tu I,u\ 111\ ….. \Illt …. ..t'fl The Ul- formah')l1 '\,'5 blaln,a f1',1 'U'ct' ,,C tto \ ttl, ,hit I,ut ,I' dl) -tIll nt., It; tH'U), J,. ('0 JII ,ltH II .. Ofi,,Ib. ,h,Wr., ' have all Ifltl'rf'st III or PUn'h,l.M' ulIl 11 hl' .., III It!… .r. ,t 1 to

Walston &- Co. —–lnc —– Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OVER 100 OFFICES CQAST TO COAST AND Q\'ERSEAS TABELL'S MARKET LETTER June 5, 1970 The stock market's most dynamic short-term upside performance of the past 30 years carne, at least temporarily, to an end last week. As the final week of May drew to a close, the market had turned from an intra-day low of 627.46 on the Dow to reach an intra-day high of 703.86 on May 29 — an advance of 75 points in just three trading days. Amazingly enough, the advance was further ex- tended in the early part of this week with an almost lO-point gain on Monday, a consoli- dation on Tuesday, followed by a further advance to an intra-day high of 723. 92 at noon Thursday. Then, finally, profit taking set in with a sharp decline at Thursday's close followed-by further weakness on Friday, Southeast Asia. At Friday's intra-day bottom of 687.91, the Industrial Average had re- traced 37 of the advance from last Tuesday. We pointed out in last week's letter the totally unprecedented magnitude of the advana; noting that records were set for both the largest one-day advance and largest two-day up- swing in the post-war period. The extension of the rally on Friday and Monday also shattered records for three and four-day advances during the post-war period. And, as we suggested last week, we think the message carried by the breadth and vigor of the rally is clear-cut and should be heeded by investors. It is quite clear, in other words, that the market has entered a new phase of some sort. What is dreadfully difficult at this point in time is to be too precise about what shap that phase may take. It is, after all, only eight trading days since the May 26 low was made, eight days with a great deal of action to be sure, days nevertheless. Most technical indicators calculated to pinpoint a9rbnter dr reversal are designed by their very nature to operate with a a will, therefore, re- quire some time before any of these indicators de' ely positive. Moreover, in order to support any sort of sustained 111 have to form on the average and,most. fmP2rtantly, in time, of course, all the more so k. is cl1aracterized'oy tlie sortof wide gyratiornthat have taken weeks. Nonetheless, for a base to be truly meaningful, a c nt of time is certail iy required. And, based on historical pre e t,' b usual if such a base pha'e were complete in much less than six mo ' It is interesti to sp as to just what the upper and lower limits of a base formation might be. often, the best guide is the initial rally itself. The upper part of the base formati often tends to be within 5 or so of the rally high and the lower part within 5 or so of the low. If we assume that the initial rally had run its course last Thursday, this suggests a trading range bounded by 760 and 595 over the intermediate term. This, of course, is more of an educated guess than a forecast and will, obviously, have to be modified in the light of future events. If we accept it as a working hypothesis, however, investment policy becomes clear. Periods of weakness should now be used without hesitation to commit reserves to the equity market. Whether the base formation process will involve new lows or not, we do not know, and we think the question is essentially academic. We stated last week our feeling that the effective low had been reached last Tuesday, and this would hold true even were that low to be violated by a modest amount. We reiterate, moreover, our conviction that purchases should be concentrated, by and large, in the high-quality segment of the list and in stocks selling at low rather than high multiples of projected 1970 earnings. We repeat this advice despite the astounding performance over the past two weeks of a number of speculative issues which were sharply depressed from their 1967-1968 highs. (Ling-Temco-Vought, for example, rose 162 in a period of six trading days.) Such performances are not at all uncommon following a climactic bottom, and the astute trader can often take advantage of them. Historically, however, as a base formation proceeds, the swings become narrower, and new leadership progressively comes to the fore. As individual base formations build up, it is the task of the technician to focus on that new leadership and to point out the opportunities that are developing. It is to this task we hope to devote ourselves over what we think will be an interesting summer in the stock market. Dow-Jones Ind. 695.03 ANTHONY W. TABELL Dow-Iones Trans 142 21 WALSTON & CO. INC. Thill ma.rket letter Is published ror your convenience and InCormntlon nnd 11 not a.n 'off(!r to sell or .t solicitation to bu) nny securities discussed. The In- rannatlon was obtained from sources we believe to be rehable, but we do not gulU'antee. lUI lccuracy Walston & Co., Inc. and Ita officers, dlrecton or ml\y-ho.ve-an .and ,sell ,the,,sec\lnues ref.erred to helem. …,

11 ! Walston &Co.—..;..,,; Inc. ., Membe New York Stock Exchange and Other Principal Stock and Commodity Exchange, OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 12, 1970 In our letter of May 29, we used the following language. It is, in summary, our judgment that the effective bottorp has been reached. The use of the word effective is cal- culated. It would not be without precedent for the market to move back to or through the old lows. Indeed, in every base formation that has occurred in the past, a testing of the lows has taken place and in some cases, June, 1962 being a typical example, that test involved the penetration of the former low by a significant amount. It was our intention, at the time, to s'xike the positive stance which we felt events warranted without succumbing to the euphoria induced by a three-day, 75-point rally. We were, in short, attempting to convey the impression that a new market phase had been en- tered .without suggesting thatall the market's .troubles.were.over. May lows was the precursor of a new bull surge. .rC\.l1y.from v' .- -. . – – Now that the rally has run its course, and the market has spent the past week declin- ing, the familiar miasma of gloom has slowly begun to return to the financial community. And yet, the outlook, of course, is unchanged from what it was two weeks ago. Without offering any judgment as to the short-term course of the market, it is possible to say today, as it was then, that high-grade stocks are and will continue to be buys on further weakness. Whether the May 26 low of 627.46 will be penetrated remains, to our mind, an academic question. From a technical point of view, ability to hold at around the 670 level would be constructive. 670 happens to be the downside objective of the top formed during the first week in June. It also happens to be a 50 or normal retracement of the May-June advance. This is all interesting to the technician but should tess so to the investor whose basic strategy should now be the g, eakness. Such selection is, at the moment, we think, a difficult r 'ri certain amount of in- tellectual gymnastics, for the criteria for stock is, feel, in the process of changing. A year or two ago the watchword U,,..,w.estern movie, consisted of good VWqu-arterto qUi t he investment world, like the er were deemea unworthy of in sensible portfolios. any price , ,.J, if a company's earnings were growing at 20 a b heap at a 100 pie sinc, hat was only 10 times results 13 years h c. a lscovered, to our sorrow, that earnings growth is mercurial, uncerta s suredly not worth an infinite price. Could it be perhaps that we will discover e co ary — that, at some price, even those companies with no m-M,ospects and with highly visible problems become cheap. Some example come to mind. Chrysler Corporation, as everyone knows, makes automobiles and, as almost everyone knows, is in some financial difficulty having lost 61 per share in the first quarter of 1970 and probably slated to do little better than break even for the upcoming quarter. Little improvement is expected before the final quarter and, for a number of reasons, it would be optimistic to assess the 1971 outlook as wildly encouraging. And yet, Chrysler earned 6. 23 per share in 1968, and had an average earning power of clo to 5.00 a share in the 1963-1968 period. We are not suggesting that Chrysler is a premier growth company; we are merely noting that 20 is not a terribly exorbitant price for a COml)alolll which has demonstrated this sort of earning power and might very possibly be able to do so again before too long. Or let us consider I,itton Indust.ries whicp the market was sna.pping up for years at 20 to 40 times earnings before it committed the unpardonable sin of having its growth curve flatten out slightly. The stock down from 112 to 17 is now available at around nine times 0 estimated results for the year to end next month and is, at the moment, not a very different company than the one it was two or three years ago. Or indeed Occidental Petroleum, whose problems can be summed up in one word, Libya. We are not exactly bulls on the Middle East outlook, but, if one were to totally eliminate all of OXY's Libyan's earnings, the pi e ratio would still be under 10. With the market down as far as it is, quite obviously, examples of this sort of thing abound. We are in an investment climate which emphasizes problems and ignores values, and we do not think it unreasonable to point out that such situations have seldom lasted long. Dow-Jones Ind. 684. 21 Dow-Jones Trans. 138.27 ANTHONY W. TABELL WALSTON & CO., INC. AWTl'Iln ThiS market letter if! pubhshed for your convemence and information ant.! IS not an OffCl to or d llollrltatlOn to buy any .seCUTitles lhscussed Th formatIOn was obtained from sources '01oe bel,t'\e to be rehable, but do not !(Unl antee Its accunl(.) alston & Go., Inc and its officers. dlr toe In- employet!1I me.y have an interest in or IJurchMe and sell lhe secunUl.'s rderred t() hel',\' ec rs or liaiidi'JUdiriIWilW'.'lilli,.mLI,iil bilild lilNti tiiiiiLiE Eli. iL IIEII' II ,;,., ,. .. i ,. j, dO .,

-' ….. /, /.; ..,….0;0- .. -………….. Walston &- Co. —–lnc —– ,-,,;-..;;— '1' \, Members New Yor' Stock Exchange and Other Principal Stock and Commodity ElChanges OVER 100 OFFICES COAST TO COAST AND OVERSEA.S TABElL'S MARKET LETTER June 19, 1970 W1th a new surge of strength, the market moved ahead last week, the Dow-Jones Industrials reaching a new high at 728.23 on Friday. Strength was variously attributed to a slowed rise In the cost of hving, the British elections, and an anticipated nse in the short interest which, indeed, materialized when the NYSE annoumed a 230/0 increase after Friday's close. However, figures on mutual fund activity during May, also released Fnday, were disappointing, showing redemptions almost equal to sales for the first time in the history of the industry. Funds, however, were net sellers during May, raising their cash position to over 10 of net assets . . – While time'will' be required'to sort'out thesedevelopmentsffior-e-and,.more.stoe-k., – as the market progresses from the May 26 low, show evidence of improving technical action , and continue to present attractive investment buying opportunities. One such issue is review i ed below. PHILLIPS PETROLEUM COMPANY Current Price 26 3/8 Oil 1S where you find it, is an adage long in Current Dividend 1. 30 use in petroleum c1rcles. But finding it and getting I Current Yield 4.9 it to market are two entirely different-colored Long Term Debt 787,413,000 birds. While many companies are optimistic about Common Stock 47,041,043 shs. huge oil deposits they believe they have discovered Sales-1970 Est. 2. 35 billion hiding deep beneath the dreary arctic wastes, the Sales-1969 2.20 billion problem of getting t consuming markets Earn. Per Sh.1970-E. 1. 85 has yet to be co e e salved. Phillips Petro- Earn. Per Sh.1969 1. 73 leum, one g t 'nternational petro- Mkt. Range 1970-69 38 3/4 – 20 leum arctic program through its 48 interest in Pacific 11 n' ortant stake In this a., and will benefit once the problems have been solved. I ' – -ea-that-attr-ae-ts-ourimmediate -,' attention to Phillips. The recent ares stems from development of the ' company's properties in the 'n where production capacity of a newly-dis- covered field could be a 6 0 0 o't million barrels daily. Phillips' interest in this field'is 37. e t a ' w' appetite of oil hungry Europe, just a short pipeline distance away, sug ns market. ' ' . Phillips has in rest other areas such as Venezuela, Iran and North Africa; Recent important discov 'es in Nigeria, offshore New Guinea and offshore Egypt are addi- tional plusses. Dome ically, Philltps is a leading integrated oil company and is one of the most broadly based In the industry, with important representation in natural gas liquids, ; petrochemicals and plastics. Being one of the largest producers of natural gas in the con- f;. tinental U. S. A., Phillips should benefit from any increase in gas rates,. action toward which, already is underway. Its Pacific Pete Interest is a further important factor in long-range natural gas production and distribution. The earnings performance in recent years has been sluggish. However, the prospect for more rapid improvement are now favorable, although higher taxes and increased costs will have some dragging effect on 1970 results. Despite this, however, mit per share shoulq', rise to around 1. 85, from 1. 73 last year. Continued firming in the LPG area arid more .. favorable chemical prices augur well for the 1971 outlook. Looking further'doWn the road,a' leading advisory service makes so bold as to suggest earnings in the 3 to 4 a share area by 1973-1975. Dividends, which have been raised annually since 1961, should parallel this gl'owi.h, . Technically, the years of unsatisfactory earnings performance have enabled Phillips to build a base of considerable breadth extending from the Jow-20s to around the mid-30s, 'I'h\s enables an initial price projection at 37, followed by a f,fgher objective 111 the low 50s. On the downside there would ppear to be a minimum risk fnctor;' conSidering the extensive Rupport recently built into the 24-20 range. Already in the Quality & Long Term Growth section of our, Recommended Li st, we feel that Phillips Petroleum is again an attractive purchase for accounts .seeking attractive . longer-term investment potential as well as for those accollnts seekirig well-defined inter- mediate term appreciation, Dow-Jones nd, 720.43 ANTHONY W. 'l'ABELL – HARRY W, LAUBSCH Dow-,Tones Trans. 139. 87 WALSTON & CO, ThiS market letter 19 published for )Qur convemence and mformAtlon nnd IS not an ofrer to sell or ,\ to huy Rny &e'C\lrlties Ih!!,cussed The In. A forrnlltion was hobfftlarmfTeld from mtere fl st OUfl'eS In or We believe t Jlulchll.Se fJ.nd o bl sell t rehabll'. but he qeCurLtlC we do not v,uarlmiE'e referrcrl to hl'ICil' its Walston & Co Inc. .R,nd Its offict!rs. directors or J -; , – …..roo .. ' .-…… ….., -. ..'

I- 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 June 26, 1970 The most that can be said for the market' action this past week is that it was unexciting Neither bears nor bulls were able to make much headway with the industrials, although Transportation and Utility indicies broke .to new lows. The market remains in a no-man' s land between 670 and 725, the successful breaking of either one of which would give a strong clue as to the intermediate term direction of the market. Ii MESA PETROLEUM COMPANY Current Price Current 'Dividend Current Yield Long Term Debt Convert. Pfd. Stk. Common Stock Sales – 1969 Sales – 1970 Est. Earn. Per Share 1969 Earn. Per Share 1970-E Mkt. Range 1970-69 Fully Diluted 28314 Ten years ago anyone predicting a natural gas 010—-shortage-would have been'regarded bY'industry- 0.3 . analysts as strange Today, however, this 33,581,563 type of comment is attended to with concerned 1,014,486 shs. deliberation. Why the change The problem 3,936,348 shs. certainly is not one of diminishing supply. Quite 26.9 million the contrary! Reserves, proven and unproven, 29 million 2. 14 are believed to be at record levels. The problem is that the reserves no longer are increasing at 2. 30 rates equal to the growing demand. In 1946, the 53 7/8 reserve-to-production ratio (Rip) was 321. In 1964 the RIP was 18'1, tn 1968 it was 14.6'1, and for 1970 it is estimated at 12. 8'1. Further declines in three years. Because of this trend, the FPC and the ind tr -t9recast for the next the situation to be severe and steps are planned to alleviate the probl–..-1 Plainly speaking, the ratio has been dropping co les have found the cost of drilling new wells to be rising faster than s of gas discovered. Thus, the low p!,ice expected to rlse,' whlch 1n turn IS e a J. ill' .. perati.ons !h t 1'1 rlllmg-acttvltres to price is with the result being a i supplies. It is the forthcoming increase in gas prices the t g s i ustry so attractive to investors at currently de- pressed prices. au c ar9i\i; s stry is MESA PETROLEUM, which already is in the Speculative . mended List. Mesa is engage' 1 a as exploration and development and to a lesser extent in contract cattle feeding. merger with Hugoton ProductIOn put Mesa into the natural gas big leagues. Reser constitute the largest package of uncommitted natural gas m the mid-continent area, roughly one-half trillion CUblC feet. Hugoton's output goes largely to intra-state customers, most important of which is Kansas Power & Llght. The agreement to sell KPL an additional 850 million mcf. of gas for an estimated 200 million has not yet been finalized. This will delay shipments that had been slated to start at mid-year. This means that an important earnings jump will not come untill971. The stock recently de- clined due in part to this delay as well as to the blocking of MSA's attempts to control Southland Royalty and lower than anticipated margins in the cattle business. Despite this, however, earnings are expected to show improvement to around the 2. 30-plus level, vs. 2.14 last year. It is in 1971 that an Important jump in per share net income is anticipated. Mesa pays no income tax on its earnings due to tax loss In view of its steadily growing reserves, its favorable position with respect to rate regulation and conSidering the steadily worsening RIP ratio of the industry, which in turn is almost certain to bring about highly deslrable price hikes, the shares of MESA PETRO- LEUM appear to offer the investor a reasonably-priced vehicle for capital appreciation over the years ahead. Technically, MESA has dropped almost 50 from its 1970 high bringing it near an area of support that exists in the low 20s. Downside risk from current levels, therefore, seem limited to the 25-22 range, while on the upside we have price obJectives in the 36 to 42 range, initially, followed by higher longer-term readings. Dow-JonesInd. 687.84 Dow-Jones Trans. 126.75 ANTHONY W. TABELL – HARRY W. LAUBSCHER WALSTON & CO. AWT -HWLmn Thill market letter Is published for your and mformAtion nnd IS not an ofter to sell or a sohcltntion to buy IIny securities lhscussed The an. formation was obtained from sources we beheve to be rehable. but we do not g\lRranlee Its ;J,ccurRC Walston & Co. Inc. and lts officers, dlrectors or employee!'! may haVe an interest In or JJurchase and sell the securities referred to helen'. WN.801

Walston & Co. Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST ANO OVERSEAS TABELL'S MARKET LETTER July 2, 1970 There comes a time, usually in the terminal stages of bull markets, when all the available financial news is good and the clouds in the economic sky, if any, appear as only specks in the distance. Often there are vague, sub-surface indications of trouble ahead, but these become dwarfed in the prevailing euphoria of the times. Viewed with 20/20 hmdsight, the end of 1968 and the early part of 1969 obviously constituted just such a period. Earnings were mcreasing; stocks were advancing, and there,appeared limit to the price the market was willing to pay for a whole host of companies whose earnings were, with apparenf certainty, gc,niftoTIse-alrever'ac'celer – ating curve on into the infmite future. — I II To be sure, the seeds of collapse were present and could be detected with a sharp eye. Inflation was proceeding at an increasing rate, and the beginnings of the monetary stringency obviously called for to stem that inflation were beginning to be seen. The rest, as, some 300 points lower on the Dow, we are sadly aware, is history. It is interesting to contrast the situation at that time with the present one, which is almost the diametric opposite. The dominant financIal news at the moment heralds disaster or, at least, pending disaster. The most obvious example, of course, is the Penn Central bankruptcy and the accompanying concern national liquidity crisis. It is not our intention to minimize the im rt e Penn Central debacle or to ignore the very real probability that Jlo a ies equal or greater size, may well follow Penn Central into the courts. si noting that the liquidity problems now facing numerous American ow pretty well advertised ones and have had ample time to be reflecte 1 ck es. There is an old adage that i,,0;-, cctiOl1 to ,the.fr,ont is i months ago, the subtile, dimly-seen portents may be heralding . than deterioration. To take one example from the market's technical a 0 let conSider for a moment recent odd-lot statistics. Without going into detail on the in retation of these statistics, suffice it to say that, while the market has been drif – ower, the ratio of odd-lot sales to purchases has been rising, odd-lot volume as a percentage of total volume has been decreasing, and odd-lot short sales have been moving up sharply. All these are trends which, if continued, could have encouraging significance. Likewise, on the fundamental front, there are signs that all is not lost. Fortune Magazine headlines its economic forecast this month The Great Turnaround and says The U. S. economy has turned the corner on its 1970 readjustment. At the same time, the Federal Reserve Bank of St. Louis, the most respected advocate of the monetarist economic position, concludes that the current hesitation in economic activity has been more moderate than in the three previous recessions, although further expressing the reservation that recovery may be slower than in past'periods. It may just be possible that we are about to achieve the neat trick of slowing down inflation without causing an economic .d'.ownturn of u.ndue seriousness. Now all this could be cancelled out by a wide wave of bankruptcies or anyone of a number of potential economic disasters. But it remains true that many stock prices are at levels which are patently silly barring only the possibility of economic collapse. Should this collapse not materialize, the probability of many of these stocks doubling in price over not too long a period does not appear remote. But nobody talks about doubles any more. That sort of talk was characteristic of 1967 and 1968. Dow-Jones Ind. 689. 14 Dow-Jones Trans. 120.47 AWT'mn ANTHONY W. TABELL WALSTON & CO. INC. This IIHlrkct letit'f IS Iuhhsht'.\ for '''UI t(JlIH'nlt)l!'C ,(1111 lllfo!lnntlfln ,Inn not ,Ill ofTu 1'-' sell or Il '1oh'ltatm to buy ,HI) hl'(UILtll'lI 'lhe tn. (ormation ….. ns ohtnillctl flOm ;,null'e We h.-lll'v,' to he rellllllil'. hut \H. do lIot !..1.l.arante Its ,11'(UIM'V, W.\I'!ton F… Co, Ine It.. nffil'erll, dlledors or l'ITlpioyL'!s may have an mtm e9t In 01 llUll'hu'!(' .11\'\ sell the 'W' UJ rpft,! rC'tl to herem WN.30t

Wdlston &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 July 10, 1970 We chose to comment in last week's letter about the atmosphere of gloom that seemed to be pervading the financial community as the Dow-Jones Industrial Average sank toward a new low in the wake of the Penn Central bankruptcy and anticipation of unfavorable second quarter earnings reports. This atmosphere continued to be the dominant factor in early trading last week as, on Monday and Tuesday, the Dow lost almost 20 points, reaching an intra-day low of 665. 32. Then, on Wednesday, for no apparent fundamental reason, the atmosphere was sharply reversed. Sharp rallies on Wednesday and Thursday ensued, with Thursday's volume just about equaling its highest figures since the May 26th reversal. Fridg.y's advance,while less ebullient than that of the,previous,1vo days, took theDow into fUrther new high territory and on a seven-point rise,' an-intra.day high of 704-.41 wa's- . -,. attained. More surprising even than the Industrials advance was the strength shown by the Utilities which posted four-point gains on both Wednesday and Thursday and tacked on another point in Friday's trading. The abrupt reversal left many commentators at a loss for an explanation. The most plausable reason for the sudden rally probably lies in the recent action of the bond market. A heavy calendar of corporate new issues has met with astonishing success and prices for seasoned issues have risen sharply. Short term yields have been dropping for an even longer period. All of this strength had been taking place while the stock market drifted lower. Under the circumstances, it was hardly surprising that, at some stage, stocks would follow suit with leadership bemg provided by high-grade stocks and utilities which are directly affected by money rates. The problem at the moment, is to assess the JPt,eani of 0 -day rally from a techmcal point of view. The short-term . e i obably hmlted. At Friday's peak the Dow had broken out of a small a with an upside objecttve of around 712. For any further rise to be ed, \Ld'e' e penetration of 720 would ., have to take place, a penetration t arket is ready for at this stage. r't – i ords;–isfor ca-cont-inuat-ion-of-the c660– ' 1 720 trading range which has The longer-range ignifl ce the early part of June. f e vance, however, although a good deal less certain, could be con 'd t Prior to the decline in late June and early July, the Dow and most med short-term dlstributional tops. In the case of the senior index the w sid jective of that top was in the 672-665 range. The Dow reached an mtra-day low 665 this week and then sharply reversed itself. The slgnificanc lies in the fact that t' is the first time since the bear market started a year and a half ago that such action has taken place. On no fewer than four previous occasions similar 1 short-term tops had been formed, and, m each case, the downSide objective proved totally meaningless as the market plunged immediately to new low levels. If the Dow could hold . its gains of last week for any appreclable period of time, we would have one more potential indication of the demise of the long downtrend. Our reference to the much-maligned DOW-Jones Industrial Average in the above comments is a calculated one. It has been pointed out, and rightfully so, that the strength of the Dow in trading sessions over the past six weeks has, by and large, been greater than that of the market as a whole. Many have drawn pessimishc conclusions from this phenomenon whereas the fact is that such action is not only normal but is, in fact, infer- entially bullish. Strength in the Dow coupled with weakness in more speculative issues, when it takes place after a long advance, is a highly bearish phenomenon. On the contrary, after a protracted market decline, such action is the normal expectation and, generally, persists for an extended period of time. This is precisely what has been happening recently and is the reason we have been emphasizing a strategy of portfolio-upgrading in these bulletins. Dow-Jones Ind. 700. 10 Dow-Jones Trans. 123.80 AWT'mn ANTHONY W. TABELL WALSTON & CO., INC. ThIS mnrket letter IS puhlJshcd for your convc-nlenre and mfolmHllOll Rnd not ofTer to sell or a hollcltutLOIl to buy any dIscussed The 11l- – formatIon was obtained from sources we behe-ve to be reilnlJlr but we do not iO).J.rantee Its Walston IJ. Co. In(', and Its officers. directors or employE!s may have an mtercet In or purchR'IC and sell the SC(Ullties referred to herem WNsol … -..,; ;ilinliinraiJM ml,ilI1DiCaiu a-a

Walston &Co. Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OVER 100 OFFICES COAST TO COAST AND OVERSEAS MARrET LETTER 1 July 17(11970 As New York baseball buffs are aware, there is a fan who sits regularly in the left field seats at Shea Stadium. When the home team makes some particularly exciting play, he holds up one of a number of signs such as Very Interesting, Amazing, or, occasion- ally, Stupendous. The gentleman and his signs would have been useful in a Wall Street boardroom this week. For after a couple of days of hesitation on low volume, Monday and Tuesday of this week, the stock market rally continued with a vengeance, posting a 30-point advance in three days and reaching a new intra-day recovery high of 739.46. The Dow-Jones Industrial Average, in other words, is now over 100 pOints higher than it was at the May 26 lows less thai.two months ago, those investor;-who wereCfalling all over theiriselvei;-to dump stock during the May panic and who have nervously been hoarding their cash ever Rinc As we said in our letter of May 29, 1970, three days after the low was made, It is, 1ll summary, our judgement that the effective bottom has been reached. The intermediate- term uptrend since that bottom occurred has now been extended to a 16. 4 advance in the Dow-Jones Industrials. To a degree, this is unprecedented in the post-war experience. In no case since 1949 has the Dow advanced by 15 or more without that advance being part of a new recovery move which carried to or close to new high ground. In other words, if one looks solely at the percentage magnitude of the advance, it is possible to make the argumen not only that we have seen the lows, but that we are witnessing the start of a new bull mark Such optimism, we are afraid, would be premature. The recovery of the past 37 trad-' ing days has been the most dynamic in the past 20 be pOinted out, that,' it followed the most precipitous decline in the past 20 ye r. erally been the technicians practice to measure a rally in terms e c of s recovered. In this sense, the present advance can be fitted directly in e cont of the post-war experienc Between December 1968 and May 1970, p r o m 995 to 631, a total of 364 points. At Friday's close, it had in 28 of the total ground lost. Com t ,by-November,had , the points lost. By August, 0 lost in the 1')61-1962 slide had been re- covered. In 1957 and 1 6, tH c ara 1 Ftirures were 41 and 46. If the recovery rally were to equal 1 6 'n nce to 747 would be called for, and, if the earlier experience were e e average could sell over 800. Based on point d igg nalysis of the Dow pattern, this sort of strength would not be surprising. Since e May the index is held in a trading area bounded largely by 725 on the upside and 67 n the downside. This base was penetrated decisively in Friday's strength, and various objectives are readable, ranging from a conservative 775 to a more optimistic 825-850. We frankly think the continuation of the strength to the 775-800 area is a distinct possibility. We are unable at the moment to envision a great deal more than this, simply, since an analysis of the patterns of all listed stocks quite clearly reveals that the ingre- dients for a broad advance are not yet present. A number of stocks, notably including some of the Dow components, have the potential for substantial intermediate-term moves from this leveL The great bulk of issues, however, remain hovering around their bear market lows with very little in the way of a base having been formed. This is confirmed by the disparity in patterns between Dow-Jones Industrials and the broader Standard & Poor's 500-Stock Index. While the Dow has penetrated a base forma- tion with the objectives noted above, the S&P has failed to attain a new recovery high and, were it to do so, it would be difficult to read an objective much above 83. This would be a percent advance considerably smaller than that of the Dow, and would be a phenomenon typical of this stage of the market. We think the pattern in summary calls for a further extension of the advance after whic a new pattern will have to form, giving a clearer picture of the long-term potentiaL Since April we have been stressing that basic policy should involve the purchase of quality stocks on weakness. The recent strength underscores the appropriateness of that policy and we continue to advise it. Dow-Jones Ind. 735.08 Dow-Jones Trans. 128. 73 . ANTHONY W. TABELL WALSTON & CO., INC. II 11 This market letter III published for your convenience nnd Informnt1(m and 18 not nIl offer to sell or ,\ sohcltation to buy nny 8e('UrltJes ..hs ed Th formation was obtained from li!ourCeA we believe to be rellable. hi we do not guarantee employees may have an mterest in or pUFchase and sell the secunt., s refErrerl to hereal, its accuracy . Walston & Co .. I nco d nn t 1S ffi 0 ceerUs,99dl ,e rectors In or WNSOl