, — …. …. — TABELL'S MARKET LETTER I l 909 STATE ROAD. PRINCETON, NEW JERSEY 08540 DIVISION OF MEMSER NEW VOAK STOCK eXCHANGE, INC MEMBER AMERICA.N STOCK EXCHANGE November 3, 1972 A number of years ago, this letter, already finding itselLperforce, in the forecasting busi- nes s developed.a .traditIOn-of- foreca sting,the-res uHs,of.pre sident-ia L electionso. That .particular …. task 1S about the easiest one facing us this week. We forecast the reelection of President Nixon. Recent reactions to Mr. Nixon's overwhelming lead in public opinion polls are interesting. We have recently seen a spate of articles proving that polls can be wrong, with abundant reference to 1948 and to the Literary Digest Poll of 1936. We must confess, in this regard, we feel a certain sympathy with the pollsters, partially, we suppose, as a result of being allied with them m the forecasting trade. 1948 polls, for example, did support the probability of a Dewey V1CtOry over Mr. Truman. There was a necessary margin for error in this forecast, and that margm proved decisive enough to tip the scales in President Truman's favor. In the present case,the margm for error is a good deal wider. Unless the American people have, overnight, developed the habit of lying to polltakers, the wrongness of the present -day fore- cast could be a great deal larger than it was in 1948, and Mr. Nixon would still emerge v1ctor- ious, the only difference being that the election would be a great deal closer than the landslide now apparently in the offing. As we suggested above, forecasting the election, at the moment, is a great deal easier than forecasting the stock market. We noted last week the fatuity of trying to link stock market fluctuations to news events, and th,S was once again demonstrated m the past week's trading. From Tuesday to F rid a y the market staged what was, by all odds, its best two-day rally of the year, advancing a total of 25 points on the Dow-Jones Industrial Average which reached a c high,onF.LLd a yju st3.a.b.ocv eLt.sp.e.a.kLe.v.e.LsoLlas.tAugust .Wew.eredulyass.med.that. this strength was due to a combination of peace expectations and better corporate earnings, despite the fact that there was absolutely no progress in the V1etnam peace talks and the corporate results released were really not surprising. Once more, with a shortage of hard events to stimulate price change, Wall Street took to inventing imaginary ones. The problem is to assess what it all means. From a technical point of view, JoVe are still, unfortunately, in not a very different place from the one we have been in,lo these many months. For the fourth time the Dow finds itself posting an intra-day high around the 980 level. The ques- tion is whether this barrier, Wh1Ch turned back the market on the three previous occasions, can this time be decisively breached. There are certain arguments in favor of the thesis that, this time, the bastion may fall Breadth has been a shade better on the recent rally than on rrevious advancing attempts. Broader price indicies, furthermore, have broken out on the upside of small base formations suggesting higher levels, although, in most cases, not a great deal higher. And there are certainly enough positive patterns in' the Dow-Jones Industrial Average itself to suggest an intermediate-term advance in that mdex, carrying it above 1000 with all the inev1table accompanying hoo-hah. Yet the question remains how excited we should get about th,S prospect. The art of investmg is a process of weighing risk against reward ,and 1t 1S the potential for large returns that should make one enthus1astic about assuming the necessary risks inherent in eqUlty investment. Thrrujr- out the summer of 1970, as the market pattern unfolded, there was the strong probability that a major bear market bottom had been.made. Based on th,S thesis, .the.prospects.for.substantial up– slde reward were exc1ting in the extreme. Even last November, as the fact of a reversal became clear, the Dow, from the low 800's, still had interesting enough upside possibilities to warrant a reasonably aggres1ve attitude. In the present case, where ups1de object1ves on most averages seem to be about 10 above current levels, evenwhenv1ewed in themostopt1m1stic light, there is not all that much to get worked up about in so far as upside prospects are concerned. None of th,S should be taken as an attempt to fight the tape too hard. If the market does ultimately demonstrate a high degree of likelihood of advance from these levels, we w1ll take due note of thefactand recommend action accordingly. The reader will forg1ve us, however, if we are unable to get as excited about upside prospects 2 1/2 years into a major bull market as we did in that bull market's infancy. Dow-Jones Industnals (1200 p.m.) 981.04 S & P (1200 p.m.) 113.79 AWTrk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No. statement or expression of opinion or any other matter herein contained IS, or IS 10 be deemed 10 be, directly or indirectly, on offer or the sol,ellallon of on offer Ie buy or sell any security referred to or menhoned The motter IS presented merely for Ihe converllmCt of the subSCriber While oNe believe the source of our Informa lion to be reliable, we In no way represent or guarantee the accuracy thereof nor of the stotements mude herein Any oclion to be laken by the subSCriber should be based on hiS own Investigation and Informallon Janney Montgomery Scott, Inc, os 0 corporation, and 115 officers or employees, may now have, or may later toke, pOSitiOns or trades In respect to any securities menlloncd In thiS or any future Issue, and such position may be different from any VICWS now or hereafter e)(presscd In thiS or any other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC as on Investment adVisor, may glvc adVice to Its Invetment adVisory and other customers Independently of any statements mode In thiS or In any other Iue Further onformallon on any security mentioned herem IS available on request

,f ,- …… T – I TABELL'S ! MARKET LETTER I -. – —- — —– ek/u/d, .Y&!I, aUl 909 STATE ROA.D. PRINCETON. NEW JERSEY 08540 DIVISION OF elm,,!, o4l,mcy !/cdt fie, MEMBER NEW VORK STOCK ExCJ1.ANaE, tNC. MEMBER AMERICAN STOCK EXCHANGE November 10, 1972 The stock market celebrated Mr. Nixon's election victory with a rousing display of fIreworks. . Much of the cglebration took pJ,,-ce.pripr tQ the event with the.advance at least temporarily halted in the first hour of tradIng on wednesdaymorig-''The-ies-tivties-we;e-nonetheissimp;;ssrve, with — the Dow-Jones Industrial Average advancmg from 936.56 to 998.42 on an intra-day basis in a period of just seven trading days. Although the Dow once again halted just under the 1,000 level, all of the broader based indices including the Standard & Fbor's 500 and Industnals, and the New York Stock Exchange Index surged ahead to newall-time highs. All of these indicators, in the proces,;; penetrated the narrow trading shelves within which they had been confined since April of this year. During the past few months, this letter has been urging a policy of caution, based essentially , On the deteriorating breadth action being manifested while the averages were contained in these trading ranges. We have also pointed out, as early as last January, the typical election year pattern, which calls for the market to be higher toward the end of the year than was the case at midyear. That pat- tern has once again been borne out. It is now necessary to assess to what extent the upside pene- tration of last week has altered the investment equation. There are, essentially, three possible interpretations of the recent rally. The first is that it constitutes the start of a new major bull market. This appears unlikely. The August/October corredion amounted to barely 6 percent in terms of the S & P 500, hardly of bear market dimensions, and the sub- sequent bottom had none of the deep oversold characteristics present at major reversals. The second possibility is that the advance constitutes nothing more than an end run or false breakout, and that, after due course, the averages will settle back into the trading ranges of the post six months, ultimately, perhaps, penetrating these ranges on the downside. This has to be con- sidered as a possibility in light of the breadth action cited above. It is, however, dangerous to comm4L too-firmlytothisviewconsiler.ing-theLdeG';s';venature.9kthe4Jpside penetratwn-.-'Jhemost – -. plausible interpretation, then, becomes one holding that the recent new highs constitute an extension of the 2 1/2 year old bull market dating back to May 1970. This places It firmly in the context ofthe five previous bull markets of the post-World War II period; and it can then be analyzed in comparison with them. The following table, based on the action of the S & P 500, shows some relevant statistics BULL MARKET 1949-1953 1953-1956 1957-1961 1962-1966 1966-1968 1970-197 to date TOTAL ADVANCE 96.75 119.02 86.35 79.78 48.05 64.84 ID.Cl'TRADlNGDW 987 726 1042 913 516 621 ADVANCES AFTER 621 DAYS 72.84 104.36 55.75 64.91 64.84 As can be seen, all past bull markets, with the exception of 1966-68, have ultimately advanced further than the present one has to date. However, unless the current upswing will ultimately set new records it must be concluded that we have already seen a goodly portion of the rise. Were the present bull ma;ket to duplicate 1962-66 it would call for only a 9 percent rise from this week's highs. Dupli- cation of 1957-61 or – — — – — – – 1949-53 would — call for rises — —-,.. fo-r 1-3– and 19 —— p e – r c ! ' !. . r e s p ectivelY — . O n l y a repetition – of the 1953-66 performance would produce a substantial rise (32) from current levels. In terms of time, as the table suggests, the present bull market is 621 tradmg days old, a bit shorter than prevlOUS advances, again WIth the exception of 1966-68. What IS interesting is the pro- portion of past advances that had been completed by the time they had reached the present one's stage of matunty. Column four of the table shows the percentage advance in prevlOus bull markets after 621 trading days. As can be seen, these figures are fairly close to the ultimaterise that was recorded. The recent technical strength, in other words, has undoubtedly Improved the mtermedIate-term stock market outlook. It is an historical fact, however, that, as bull markets grow more mature, the rate of advance tends to slow down and selectivity increases dramatically. Any further extens ion of the rise from current levels must be vIewed in this lIght. Dow-Jones Industrials (1200 p.m.) 997.97 S&P (1200 p.m.) 114.26 ANTHONYW. TABELL DELAFIELD, HARVEY. TABELL AVtTTrk No stotement or expression of opinion or ony other matter herein contained 1, or 15 10 be deemed to be, directly or ,ndirectly, on offer or the soliCitation of on offer to buy or sell any security referred 10 or mentioned The motter IS presented merely for Ihe converlf,nCE of the subSCriber While lie believe the sources of our ,nforma lion to be reliable, we In no way represent or guarantee the occurocy thereof nor of the statements mode herein Any oellon 10 be token by The subscnber sMould be based on hiS own investIgation and information Janney Montgomery Scali, Inc, as (I corporation, ond lIs officers or t!mployees, moy now hove, or may loler loke, positions or !Tlldes In respect 10 ony curltles mentioned In thiS or any future Issue, and such pOSitIOn moy be different from any views now or hereoFter el'pressed In th or any other IlSlJe Janney Montgomery S/olt, Inc, whICh IS registered WI,h thc SEC os an Invcstmcnt odvlsor, moy give odl'ICC to Its Invcstment adVisory and othel customers Independently of any statements mode In thiS or In any other lSue further Informohon on any security mentioned herein IS available on request

r— —— – -.-, TABELL'S MARKET LETTER — – —- —- —. 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEM8ER NEW YORK STOCK EXCHANGE INC MEM8ER AMEAICAN STOCK EXCHANGE November 17, 1972 We had prepared for this week a lengthy celebration of the apocalypse, commenting on the con- clusions to be drawn as the Dow, Jor the first time in history, managed to close above the 1000 level. In the-process wecame across ';'hateh6d;,;,ritt;i';-n;;this space om-e-21;;orrths ago OnJa;uarY-15 1971, and we can think of no better celebration than to repeat those words here. What follows, then, is taken verbahm and (except for introductory paragraphs) in its entirety from that letter. The only change Wh1Ch needs to be made is to the last line of the table which should note the fact that the 1966 Dow high was exceeded in November 1972, after 81 months. —————————————————————————————- We think one of the central facts about today's stock market is that, very shortly, on February 9 to be precise, we will pass the fifth anniversary of the date on which the DJI last made its all-time high. We do not think that this piece of intelligence falls into the familiar category of intereSting statistics not worth knowing, for it tells a great deal about the character of market action over the past four or five years. The following table sets out the major highs in the DJIA since March 1937, together with the date each high was subsequently exceeded and how long it took for that high to be surpassed. DATE HIGH DATE HIGH EXCEEDED NO. OF MONTHS ADVAIICETO NEXT HIGH March 1937 195 December 1945 104 9 June 1946 212 April 1950 46 39 January 1953 295 February 1954 13 78 July 1957 524 September 1958 14 31 January 1960 688 April 1961 15 8 November 1961 744 September 1963 22 34 — .Febr-uary-1966–lQOO ..—–160.(to-date)- -…..,.- As the table quite clearly shows, not since World War II have we gone as long as this without postmg a new peak in the Dow and, indeed, the common experience throughout the 50' s and early 60's was that previous h1gh generally was surpassed in less than two years. Now the central fact of this kind of market is that it is very forgiving of mistakes. In the sort of environment that prevailed from 1949 to 1966, there was really minimal risk in entering the equity market at a relatively high level. One seldom had to wait long before the secular uptrend bailed one out. This has, most conspicuously, not been the case in recent years. The investor who performed no better than the averages has a loss to show for five long years of effort is he entered the market at the 1966 high. And the performance m individual stocks has been even more tragic, most steel stocks, for example,'having made their all-time h1ghs in 1959. All of the above is, of course, another way of stating a rather simple mathematical fact–that the equity market from 1942 until 1966 was buoyed by a secular uptrend advancing at the rate of about 9 a year on the Dow. Sure, there were bull markets and bear markets within the framework of that uprend, but the bull markets were long and dynamic and the bear markets, although painful, short and quickly recovered. There is real eVidence, at the moment however, that the secularuprend is no longer with us. Indeed, computed from 1966, the slope of the DJIA has been virtually zero. The most statistically accur- ate description of the market on average for the past five years is that it is a wide, flat trading channel. Of even more significance, we think, is the fact that our forecast for 1971-1972 is totally consistent with this kind of a pattern. We are looking, it will be recalled, for the 1966 high to be exceeded, btl only modestly, at some,time,m 1972. –It would be .perfectly consistent with .the past half decades behavior for the market to top out somewhere around that level. It would also, as the above table shows, be only the second time since 1946 that a new high failed to surpass a former peak by a significant amount. Now, if our thesis is correct, the implications for investment policy are many and important, and we intend to d1SCUSS them at some length in upcoming future issues of this letter. One conclUSion, however, 1S quite obviOUS, and that is that there is no longer any rationale for buy-and-hold as a sen- sible investment policy. The thought that the key to success for the conservative investor was simply to buy good stocks and hold them was one that gained a great deal of currency during the early part of 1960' s, born, as it was, out of a decade during which the thes1s had, in fact, a great deal of valid1ty. If it is no longer valid–and we think a case can be made that it is not–then the way that a great deal of money is managed is going to have to be altered radically. —————————————————————————————- Dow-Jones Industnals (1200 a.m.) 1004.21 ANTHONY W. TAB ELL S&P (1200 a.m.) 115.28 DELAFIELD, HARVEY, TABELL AWTrk No statement or expression of opinion or any other moiler herem contolned IS, or IS to be deemed 10 be, directly or indirectly, an oHer or Ihe sollcllollon of on offer 10 buy or !roell any security referred 10 or mentioned The molTer 15 presented merely for Ihe converrcnCE of Ihe subSCriber While 'I'Ie believe Ihe s.ources of our Informa tlon 10 be relloble, we In no way represent or guarantee Ihe accuracy thereof nor of Ihe slolemen'S mude herem Any ClCllon to be token by Ihe subSCriber should be based on hiS own Investigation and Information Janney Montgomery Scali, Inc, as a corporation, Clnd liS officers or employees, may now hove, or moy latcr toke, pos\tlons or trades In respect 10 any seCUrll1cs mentioned In Ihls or Clny future Issue, Clnd such position may be different from ony views now or hereafter epresed In thl or ony other Issue Jonney Montgomery Scali, Inc, which IS registered With the SEC os on Investment odvlsor, moy give adVice to Its invesfment adVISOry ond othel CUSlomers Independently of ony stotements mode In thiS or In any other Issue Further onformatlon on any seC\Jrlty mentioned hereon 15 available on request

TABELL'S I I MARKET I I LETTER I J 909 STATE ROAD, PRINCETON, NEW JERSEY OB540 DIVISION OF MEMBER NEW VOAK STOCK EXCHANGE, INC MEMBER A.MERICAN STOCK EXCHANGE November 24, 1972 -One'must-react to lastweek-' s, market as-one wouldto..thespectacleof a 'decorous-maiden aunt -who-had suddenly taken to weanng hot pants and collecting rock records. It was, in the words of 'Adam Smith' in the Money Game, a roily-boily stock market,with the rather umque facet that the issues domg the roiling and bolling would have been eminently at home in bank trust department portfolios circa 1950. Nonetheless, an exciting stock market is an exciting stock market, regardless of the names providing the excitement, and, by any standards, the market of the past few weeks has qualified. Last week's market saw the Dow, now comfortably above the 1000 level, sailing forward to a newall-time hlgh of 1026.87 with volume running regularly in excess of 20 million shares daily. The strength shown is undoubtedly Significant and portends well for the short to intermediate term outlook. However, to our mind, the most slgnificant element about the recent rise is not the rise itself but the shift in market leadership, glimmerings of which had been seen for the past six months, which, last week, became almost painfully obvious. PERCENT CHANGE May 1970-Summer Summer 1972 High- October 1972 Low- 1972 High Date Date Dow-Tones Industrial Average 55.3 4.1 10.7 N.Y.S.E. Industrial Index 78.0 1.7 8.7 Indicator Digest Average 52.1 -9.5 5.6 American Stock Exchange Index 47.3 -7.9 2.4 NASDAQ Industrial Index -10.8 3.9 This shift can be illustrated statistically by reference to five of the standard stock market indices, each of these indices providing a fairly decent representation of the market action of a particular class of securities. The Dow-Jones Industrial Average is, of course, representative of large cyclical or moderate- – –growth1ndustria I. com pame s ;- The'broaderNew-York 'Stock' Exchan'Je-IntlUS ttlarIlld-ex 'inClude s -tile s ecb- panies but also gives considerable weight to the larger-capitahzation growth compames which have formed he cornerstone of portfoli pollcy in recent years. The still broader, unweighted Indicator Digest Average IS an accurate representahon of the performance of New York Stock Exchange issues as a whole. whereas the American Stock Exchange and NASDAQ Indices are accurate representations of the action of a more speculative class of equilles. As can be seen, the performance of the New York Stock Exchange Index from the inception of the bull market in May 1970 through last summer was distinctly superior to that of any of the other averages. The basic reason for this was the inclusion in that index of the classic growth companies which, over a two- year period. managed to outperform the average issue by a s1gnificant degree. In recent months, however, the Dow has quite obviously come into its own. Its advance from its late October low, where the current rise began, is in excess of 10 percent ,comfortably better than all the other indlcators. The New York Stock Exchange Index has moved up somewhat less and, as a consequence, is only slightly above its late summer high. Equally significant is the fact that the performance of the other three averages on the recent nse has been comparatively desultory, and all of these three indices are considerably below their previous highs despite the fact that the Dow has sailed forth into hitherto uncharted heights. What has happened, in essence, is that the moderate-growth and cyclical blue chips have taken over leadership from the already exploited growth issues. However, there has been absolutely no shift of investment interest into the more speculative areas of secondary New York Stock Exchange stocks, American Stock Exchange issues or Over- the-Counter stocks as shown by the action of the Indicator Digest, Amencan Stock Exchange, and N1\SDAQ Indices. From a technical pomt of view, there appears to be very llttle point m flghting th,s tide. Although aggresive investors may feel uncomfortable 1n such groups as international oils. banks, and ut1lities, the improving'tecnnical'actlonof these and other moderatE!-groWth-issties stronglystlggests that they will' be among the better capital gains vehicles over the intermediate term. Moreover the fact that such issues are still moderately priced by historical standards provides a certain defensive element which seem appro- priate at this stage of the market. In terms of the Dow, various upside objectives are now readable, centering around the l050-1100 range. Based upon historical precedent, Wednesday's raise in margin requlrements should have little effect on these obJectives, smce previous such raises have tended simply to moderate market advances rather than stifle them. It is possible that at some future stage the advance may be joined by secondary and tertiary issues. However, technical readings at the moment give no lndication of this phenomenonl s taking place. Dow-Tones Industrials (1200 p.m.) 10022.58 S&P (1200 p.m.) 116.89 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL AWTrk No statement or expression of opinion or cny other matter herein contained IS, or IS 10 be deemed to be, directly or Indirectly, on offer or the soliCitation of on offer to buy or sell any securlly referred 10 or mentioned The matter IS presented merely for the convel'Ienct of Ihe subSCriber While we believe the sources of our Informolion 10 be reliable, we In no way represenl or guarantee Ihe accuracy thereof nor of Ihe statements mude herein Any actIOn to be token by the subscriber should be based on hiS own II'lvestlgatlon and InformatIOn Janney Montgomery Scali, Inc, as a corporation, and lIS officers or employees, may now have, or may later lake, posilions or trades In respect 10 any securl!les mentioned 111 Ihls or any future Issue, and such pOSITion may be different from olly views now or hereofter expressed In Ihu or cny other usue Janney MOlltgomery Scali, tnc . whICh IS registered wITh the SEC as 011 Investment adVisor, may give adVice to Its Investment odvlOry clld other cvstomers Independelltly of any statements made 11'\ thiS or In any olher Issue Further informatIon on any secvflty mentioned herein IS ovolloble 011 request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YOAK STOCK eXCHANGe. INC. MEMBER AMERICAN STOCK eXCHANGe – December 8, 1972 Greater than the tread of mighty armies is an idea whose time has come. 0 o – – -, -, Victor,Hugoc Hugo's oft-cited quotation is equally applicable to the equity market as to other fields of endeavor. For stock-market purposes, however, it is necessary to append to the quotation and say, An idea whose time has come–again. For there are seldom any new ideas in the stock market–only old ones which, at irregular intervals, become rediscovered as blinding flashes of revealed wisdom. One such notion, dormant for almost ten years and now, apparently, in the process of rediscovery, is the concept that util- ity stocks, as a class, might constitute attractive investment vehicles. The table below cites price and earnings statistics for the Standard & Poor's Utility Index plus two representative utility stocks, Florida Power Corporation, generally regarded as a growth utility, and New England Electric System, a typical example of the more stable income type. All figures given are for the year-end except 1972, where present prices and full-year earnings estimates are used. I S & P UTILITY mDEX I FLORIDA POWER CORP. /NEW ENGLAND ELECTRIC SYSTEM Year End I Price Earnings gain P,1; ratio I Price Earnings gain P;tratio I Price Earnings gain P;t ratio 1962 61.09 3.06 5.2 20.0 44 1.59 27.7 25 1.36 18.3 1963 66.42 3.22 B.6 20.6 44 1.59 27.7 27 1.46 7.3 18.4 1964 74.52 3.50 B.6 21.3 47 1.77 11.3 26.6 29 1.50 2.7 19.3 1965 75.51 3.8B lO.B 19.5 46 1.B9 6.7 24.3 30 1.60 6.7 18.B 1966 69.35 4.16 7.2 16.7 48 2.12 12.1 22.6 28 1.73 8.1 16.1 1967 66.08 4.40 5.7 15.0 46 2.27 7.0 20.3 26 1.93 11.5 13.4 1968 69.69 4.41 0.2 15.8 42 2.51 10.5 16.7 2B 1.94 0.5 14.5 1969 56.09 4.61 4.5 12.2 49 t970. S1.V, 4.67–1.13.255 1971 59.834.92 5.3 12.1 46 2.91 15.9 16.8 22 1.96 1.0 11.2 3.0B 5.8 17.8 23 1.98 1.0 11.6 3.ci2.l.9-i5224-5-3.5- -Ii. 7'— – – 1972 62.35 5.16 4.9 12.0 50 3.35 10.9 14.9 27 2.30 12.1 11.7 10 year compound 5.3 7.8 5.4 growth rate The figures are interesting. The first relevant conclusion is that, for the past ten years at least, there has been absolutely no reason to own these stocks. Both the Index and New England Electric are selling today below where they were selling in 1964, and the price of Florida Power is not that different. The second obvious conclusion is that, despite the lackluster performance, the fundamental record for the industry is fairly good. Earnings for the utility average have managed to grow at a rate of 5.3 a year compounded, an increase which has been duplicated by New England Electric. Florida Power, meanwhile, has been growing at a rate half again as great as that of the industry. , It is also notable that the market has tended to accord to the Index and to the two stocks fairly con- sistent pie ratios relative to each other. In recognition of its growth rate, Florida Power has consis- tently sold at a higher multiple than the mdustry as a whole, and New England Electric at a very slightly lower one. What the table clearly shows, however, 15 the fact that, despite the fundamentally good record, the market has tended to place a decreasing value on utility earnings over the past decade. A dollar of earnings by the Utility Index was worth 20 in 1962 and is worth only 12 today, and the record of the price-earnings ratios of the two stocks is similar. Now all this is just another example of the point that we, as market technicians, repeatedly feel com- pelled to ra-ise, i.e. that prices depend on investor sentiment as much as on earnings. The earnings record for the utility industry over the past decade is impeccable. Its price record is dismal. The im- portant factor at the moment is not that fundamentals have improved; they have simply stayed the same. It is that technical factors suggest a possible change in the attitude which the stock market might take towards the industry. In 1964, the Standard &Poor's Industrial Average sold at a lower pie ratio than did the Utility Index. At mid-1972, the Industrial pie was almost twice as great. Florida Power can be bought today at less than 15 times estimated 1972 earnings, affording a 3.5 yield. New England Electric, with a more slowly growing earnings trend, affords a 6.2 dividend return. The investor in selected utilities today, it seems to us, is assured of reasonable income and, even should the present technical strength prove ephemeral, slow capital growth in line with continuing earnings improvement. Should the market again come to regard utility stocks as highly as it did in the early 1960's, the capital-gains potential would be rewarding indeed. NOTE The above comments are bas ed largely on technical factors. Further information is available on request. Dow-Jones Industrials (1200 p.m.) 1033.71 S&P (1200 p.m.) llB.64 AWTrk ANTHONY W. TABELL DELAFrELD, HARVEY, TAB ELL No statement or expression of opInion or any other motter herein contained IS, or IS to be deemed to be, directly or Indirectly, on offer or the soliCitation of on offer to buy or sell any security referred 10 Or mentioned The matter IS presented merely for the converlence of the subSCriber While we believe the SOlJrces of our Informa han to be reliable, we In no way represent or guarantee the accuracy thereof nor of the slotemel'1is mude herern Any action to be tak.en by the subscrrber should be based on hiS own Investlgohon cmd 'nformatlon Janney Montgomery Scoll, Inc, as a corporation, and Its officers or tr!mployees, may now have, or may later toke, poSitions or lrades In respect to any seCl,lfll,eS menhoned rn th,s or any future Issue, and such pOSition moy be dr/ferent from any views now or hereafter expressed rn thiS or any olher Issue Janney Montgomery Scott, Inc, which IS registered With Ihe SEC as an IIlVestment adVisor, may give adVice to lIS mveslment adVISOry and othel customers Independently of ony statements mode In thiS or In any other luue Further rnformotlon on any security mentioned herein IS avorlable on reques

.- — — — ———–'——–l j ! TABELL'S II MARKET LETTER I I , \ .. .-JI 909 STATE ROAD, PRINCETON, NEW JERSEY 08640 DIVISION O'F MEMBER NEW YORk STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE December 15, 1972 ..- –;;-. Our readers-are no doubt aware-that it-isour-practice.to devote-the'last-few'issues of. this letter each year to a forecast for the year ahead. This exercise is generally divided into two parts, the first being a review of the market events of the prior year and the second an attempt to see how these events shed light on the future. This letter, then, constitutes the first part– a look back prior to a look ahead. In the present instance, we think it essential to an understanding of the current market to look back, not just a year, but some two years and seven months, to May 26, 1970 when, as we all know, the Dow-Jones Industrial Average bottomed out at 631.16 after the worst bear market of the post-war era. As the cries of doom and gloom gradually subsided, the Dow, over the next 11 months, advanced over 300 points to reach a high of 950.82 in April 1971. Summer, 1971 was a period of general market weakness, although many issues were resistant to the decline, and, by Fall, almost half the initial phase of the rise had been retraced, as the index reached a low of 797.97 in November. From that point, another upward leg began, with a closing high for the Dow of 968.92 being recorded in April. Summer, 1972 was, like Summer 1971, a period of weakness but with one essential difference. Whereas in 1971 the market averages had performed worse than the aver- age stock, for 1972 precisely the opposite was the case. The period April-November 1972 saw a sideways trading range in the 900-980 area, as far as the averages were concerned, but many stocks underwent sharp declines. This phase, of course, terminated with the recent rally, as c. the D b…'''.k-te,..!..oention.on the .upside, reag .!..high (to ate) of 036. 32. f'. r…Now tile purpofe of tillS lengtny exerClse lS to remlOO US to place the-present marKet sltua tion in context. We are in a bull market. That much is obvious. We are, more preCisely, in the third upward leg of that bull market, there having taking place two corrtctions (April-Novem- ber 1971 and April-November 1972) which can be classified as mtermediate-term in scope. That bull market has gone on now for more than two and a half years, 654 trading days,and encom- passes a 65 advance for the Dow-Jones Industrial Average. A month ago in this space, we cited the above statistics and compared them with other bull markets of the post-war era. We do not propose to reiterate all these comparisons here, but it will be recalled that the conclusions were, 1) that a good portlOn of what would ultimately be the total bull-market advance had probably already been seen and 2) that a topping out of the advance sometime in 1973 would be entirely m line with historical precedent. This remains true despite the almost total lack of evidence, on a short-term basis, of such a top forming in the immediate future. While the present bull market is in no way different in character from past such advances, we must also remind ourselves that it is taking place in an entirely different context. The fact that 1972 has been a year in which the low was recorded in January and the high in Decem- ber helps to obscure the fact that the average price for the year is about 960, not too different from the average price of 1965, seven years ago. The present bull market in other words has, to date, been totally consistent with the relatively flat secular trend which, as we have been P9inting out m this.spacead.nauseam, ha chatacterized the market i!1ce the mid-1960's,,in vivid contrast to the secular uptrend which had been rising at a rate of 9 for some 20 years through 1966. We thus find ourselves, 1) somewhere in the mature stages of a bull market and 2) near the upper part of the trading channel which has characterized the last seven years of stock market activity. Another point should be noted. As we suggested in our 1972 forecast, the fact of an election year augured well for the yeats market prospects. The historical record of post-election years is unfortunately conslderably less auspicious. Every major bear market since 1929 has begun in the year following an election or in the hrst half of the succeeding year. We think that all of the above factors will be relevant to a 1973 forecast. Dow-Jones Industrials (1200 p.m.)l024.53 ANTHONYW. TAB ELL S&P (1200 p.m.) 118.11 DELAFIELD, HARVEY, TABELL A VERY MERRY CHRISTMAS TO ALL No statement or expreUlon of opmlon or any other matter herem tontclned IS, or , to be deemed to be, dlrettly or mdlrectly, on offer or the lollcltotlon of on offer to buy or sell any security referred to or mentioned The matter IS presented merely for the converlente of the subscrlber While we beheve the sources of our mformatlon to be reliable, we m no way represent or guarantee the o'Curccy thereof nor of the statements mude herem Any oct,on to be taken by the subscrtber should be based on hiS own mveshgotlon and information Janney Montgomery Seall, Inc, 0 a corporOllon, and Its officers or employees, may now have, or may later toke, POSitions or trades m respect to any seurtt,es mentioned In th,s or any future Iswe, and such postllon may be different from any views now or hereafter expressed m thIS or any other Issue Janney Montgomery Scolt, Inc, whIch IS regIstered With the SEC os on Investment adVIsor, may gIve odvlce to ,1 mvestment adVisory and othe, customers Independently of any statements mode m thIS or m ony other Issue Further InformatIon on ony security mentioned herein 1 avadoble on request

\ \ TABELL'S MARKr LETTER I. 909 STATE ROAD. PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW VORk STOCK eXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE December 22, 1972 But who knows where or when -. . c ,C-.-,.-.,. . '. . . -., Rodgers,and-Hat,– ,.,-.,,……,. As the time comes to issue a 1973 forecast, the question posed by the stock market is quite clear and is embodied in the popular song. The answer, as we shall see, is less definitive and depends on a number of factors as yet unknown. Reviewing our forecast of a year ago, we find it essentially in the ball park, albeit a bit con- servative. We said in this space on December 23, 1971, The market is … likely to .. spend most of its time in the 800-950 range (It) should be noted that 1972 is an election year, and the normal shape for such a year is a flat-to-down market in the first half, followed by higher prices during the second half. Thus, our projected 800-950 range, if it is to be Violated, is most likely to be exceeded on the downside in early 1972 and on the upside in the latter part of the year. The projected range was, in fact, never exceeded on the downside, and turned out to be at a slightly above the one we had anticipated, i.e., 900-980. AS,the election year pattern accurately forecast, the upside violation came at the end of the year, in November an! December, and we now find ourselves at approximately 1000 on the Dow, moderafely above the trading range we had envisioned. The task at hand is to relate this market action, as it did, in fact, develop, to a rational market expectation for 1973. We drew attention in last week's letter to three factors we considered relevant. They were as follows 1) A comparison of the present bull market with past bull markets indicates that we are in all probability, in terms of time and amplitude, at a reasonably mature stage. 2) We are currently near the upper part of the market trading range, which our analysis of supply/ dem-a'i\d'f6rces read'sus'-tc)be1ieve w-illdlYmiha te-marketacrionirt'lea-s1'for lheear'lyT9 70'''s'''.-..,.—I 3) The seasonal pattern for the initial year of a presidential administration is .such that a correc- tion of major proportions in 1973 or early 1974 is a real possibility. We know then what we are looking for–a market top. This should not be surprising. All bull markets have topped out in the past and this one will, also. The questions are Where and When –when, because if a top is well off into the future there is little point in allow- ing it to dominate our current investment thinking, and where, because, if the top is going to occur at much higher levels, the ultimate bottom will be at prices not too much different than current ones. History furnishes us with some less-than-precise guidelines. If the experience of 1953- 1956, for example, were to be duplicated, the top could occur as early as next March. If, on the other hand, the present bull market equaled the one of 1957-1961 in length, the ultimate peak could be deferred as long as March 1974. As to the question of where, current upside objectives on the Dow center on the 1050-1100 range, and we are willing, for the present, to use this as an approximate target price. The central factor which will probably determine the length of the present bull market is at present unknown. The last upward phase has featured a distinct and dramatic shift in leader- ship away from high pie glamour issues, in favor of lower priced, slow-growth, and cyclical stocks. We would expect a continuation of this phase to carry the market higher, at least in the early months .of )973. The ,question is whetheL there ,will then be a.further, shift.of ,interest in favor of secondary and tertiary issues. There is at the moment absolutely no sign of this occurring, but, if it does occur, it could well prolong the life of the current upswing. Our foreca st for the year, then, must call for higher prices, to be reached, in all probability, during the first half of 1973. Whether the favorable market climate can be sustained through- out 1973 will depend, in great part, on whether the market can broaden its leadership to seg- ments of the list hitherto ignored. WE WISH YOU ALL A VERY HAPPY NEW YEAR Dow-Jones Industrials 11200 p.m.)1003.39 S&P (1200 p.m.) 115.62 AWT rk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement to buy or sell or expression 01 opinion or any other any security referred 10 or mentioned molter here'n The moiler IS contolned presented 15, or 1 to be merely for the cdoenevmeredIe1n0boef, directly or mdnec1ly, the subscrIber WhIle on -Ne offer or believe Ihe the 5o0u1rIcCeItootiof nouorf on offer Informa- tIon to be reliable, we In no way reprelent ar guarantee the accuracy thereof /lor of the statements mude herell'l Any achon to be tai-en by the subscriber should be based on hiS own Invesllgohon and Informallon Janney Montgomery Scolt, Inc, as a corporation. and ItS officers or employees, may now have, or may raler toke, poSitions or trades In respect to any SeCUrities menhoned In thiS or any future IUe, and such position may be d,ffere'lt from any views now or hereafter expressed III thiS or any other Issue Janney Montgomery Stott, Inc, which IS regIstered w,th the SEC as on Investment adVisor, may give adVICe to Its IIlvestment adVISOry, and othel C\,ISfOmerS ,ndependently of ony statements mode ,n thn or III any other Issue Further Information on any security menhoned herein IS available on reques,

po – – – . -.. I TABELL'S I MARKET LETTER — – —– 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEM8ER NEW YORK STOCI( EXCHANoe, INC MEMBER AMERICAN STOCK EXCHANGE December 29. 1972 -For some-yearsnow, we-havestudied-.the fam-i-!-iarseasona-l tendencyofthe-stock -mar-ket-to stage a year-end rally, and it has been the custom of this letter each December to pOint out some of the conclusions that can be derived from a study of this phenomenon. We have suggested that an exhaustive study of chart patterns since the Dow-Tones Industrial Average first was computed in 1897 indicated that such a rally, h01.'.everminiscule, invariably had taken place. A number of intereSting facts about the market action of the year-end may be noted. (1) – As stated above, an identifiable year-end rally has taken place in every year since 1897. This rally often has been of great magnitude with advances as great as 28 having been recorded. It also, on occasion, has continued with only minor interruptions for as long as six months into the new year. However, on other occasions, it has been of only a few days' duration. reaching a top extremely early. Thus, in 1960, 1962,and, most recentlY,in 1970 the rally reached a peak in the first week in Tanuary. In 1961.1964,1967, and 1971. it continued into February or March. In 1971, the rally continued through mid-March. (2) – There has been a persistent tendency for the rally to begin early in years when the market has been up, and late in years when the market has been down. In recent upward years, 1959, 1963, and 1967 are examples, the rally commenced from early December. In 1962, 1966 and in 1969, it began late in the year. This year's rally, typically, began in late November. (3) – The important thing to watch in connection with market action in the early months of the new year is tlTe-low forth-e'previo\lsDecember–This-iuvrtra-s- been-broken'in-fortythree – – years out of the past seventy-two. However, in twenty-five of these forty-three cases, itwas broken in Tanuary and February. Since 1937, it has never been broken later than mid-March, with the single exception of 1965. Thus, if the market is able to hold above its December low for the first 2 1/2 months of the year, chances become good that this low w ill not be broken. For example, in 1960, 1969 and 1970, the December low was broken early in Tanuary. In 1963, 1964, 1967. and 1971, and, most recently, 1972, it never was broken. 1965, as noted above, was unusual with the December, 1964 low of 850.19 being broken in Tune when the Dowreached an intra-day low of 832.74. (4) – In years when the December low has been broken, the subsequent trend has been downward two-thirds of the time. 1960, 1962, 1966, and 1969, of course, are typical cases. Again, 1965 was an exception. 1970, of course, was a down year in the first half. (5) – The magnitude of the rally is an important clue as to the year's market trend. For example. an advance of 10 or more from the December low has been followed byan upward or neutral market in thirty-one of the thirty-six years that such an advance has occurred. An advance of less than 10 from the December low before an identifiable correction takes place has been followed by a downward market in t wenty,four of the thirty-six years. 1963, 1964 and 1971, the year-end rally approximated 10, and in 1972 it was 17. In 1960, 1962, and 1970, for example, it was less than this figure. (6) – The length of time in which therally continues intothe,new yearalso is important. For example, in nineteen ye;;'s the raily continued into MaiCh or later. – In seventeen of these nineteen years the eventual trend was upward. In 1964 and 1972 the year-end rally continued into March and in 1961, 1963, 1967 and 1971 into February. In the coming year. therefore. the December low of 1000 is an important point to watch. If this low is broken. it would be a strong indication of probable market weakness. A like indication would be failure of the Dow to advance 10, or to approximately 1100. On the other hand, if a rally continues into February or March, or reaches above 1100, an extension of the upswing might be indicated. Dow-Tones Industrial (1200 p.m.)1018.36 S&P (1200 p.m.) 117.75 AWTrk ANTHONY W. TAB ELL DELAFIELD, HARVEY, TAB ELL No statement or expres.slon of opInion or any other matter herem contOlned IS, or IS 10 be deemed 10 be, directly or mdl-ectly, on offer or the sollcltoTlon of on oHer to buy or sell any secUrity referred 10 or mentioned The motter IS presented merely for Ihe convel.enC1i of the subscriber While e believe the sources of our Informa t.on to be rel.oble, we In no way represent Of guarantee the occuracy thereof nor of the statements mude herein Any action to be token by the subSCriber should be based on hiS own investigation and Information Janney Montgomery Scott, Inc, os a corporotlon, ond It off,cers or employees, may now have, or may later toke, POSitIons or trodes In respect to ony seCufltles mentioned .n thiS or any future Isue, and such POSitIon may be different from any Views now or hereafter el'pressed In Ihls or ony other Issue. Janney Montgomery Scali, Inc, which IS registered wllh the SEC as on InveUmcnt adVISor, may give adVice 10 Its Investment adVISOry and othel CVitomers Independently of any stotements made I thiS or In any other Issue Further information on any secvrlty mentioned herein IS Qva.loble on request