0..- – .-0-.- .– .. . — – . – – – TABELL'S MARKET LETTER H , I , – – – – .I .Yt/t1C1tey, !YaM 909 STATE ROAD, PRINCETON, NEW JERSEY 08!540 DIVISION OF ,)''71 uit,n'fomcy YcdI fnc. MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGe – March 16, 1979 ..,.,.- – '— ,-the Dow' the broad 800-850 trading area moving laterally in preparation for what appears to be an attempt to penetrate the hi gh of 859.75 made on January 26. Recent ma rket weakness corrected the Dow Jones Industrial Averages to 807.00 on February 27 andthe last few weeks has been spent recouping this loss. As has been pointed out recently in this letter. the most serious technical weakness seemed to be centered around the senior growth stock area. A posting of 860 on the DJIA would clearly signal an upside breakout of this trading area on our point and figure charts indicating a potential move to new highs. ;-;; Within this framework of the Dow Jones Industrial Average, the American Stock Exchange Average continues to perform extraordinarily well completely ignoring the 26.61 correction experienced in the DJIA from the July, 1976, high to the February, 1978, low as shown in the table below. DJIA Percentage ASE Change Percentage Change Dec. , 1974 Low July, 1976 High Feb., 1978 Low March, 1979 577 .60 1011. 21 742.12 847.02 -075.07 -26.61 14.14 58.26 107.05 122.48 171. 62 -083.75 14.41 40.12 To help clarify this remarkable performance, the chart on the lower half of the reverse \—–1' dramatically outperformed the DJIA since the 1974 low. However, these figures need to be examined more closely and are not intended to infer or represent to the reader that that average issue on the American Stock Exchange has in fact outperformed the average issue on the NYSE by the percentages outlined in the above table. To better understand, it is interesting to observe the breadth behavior of the ASE and NYSE over the same period. Starting with a base of 30,000 on January 1, 1974, daily net changes (advaDces-declines) were cumulated on the ASE and NYSE. The results are shown on the upper half of the chart on the opposite page. These results seem to be in direct conflict with the averages charted below — but they are not. The apparent secular downtrend and behavior of breadth on the ASE can be explained by examining the characteristics and noting the differences of the issues which trade on the ASE from thosE!' on the NYSE. Obvious di fferences whi ch come to mind woul d incl ude fewer issues listed and traded; average price of ASE issues is smaller; listing requirements such as capitalization less stringent. Other effects on ASE breadth would include takeover by larger NYSE companies or the transfer of listings to the NYSE from ASE. What this means, then, is we are comparing two sets of statistics with different characteristics and the difference should be clearly understood when examining the breadth data. Of course, one explanation for the spectacular rise in the ASE average and the corresponding decline of the ASE breadth over the last five years can be explained by examining one group — Canadian Oils. The auction market has for years been able toC-identifY.pockets .of inefficiency.in the marketplace but in the case of the Canadian Oils, a pocket of efficiency seems to have been d,scovered. Technically, the performance of these stocks over recent years as reflected on the most active and hew high lists cannot be dismissed. We are, of course, aware of the outstanding performance of stocks like Canadian Superior Oil and Dome Petroleum. However, the concentration of this group can be extended to other technically attractive stocks such as Ashland Oil, Asamera Oil, Aquitaine of Canada Ltd., Canadian Homestead Oils, Gulf Canada Ltd., and Husky Oil Ltd. to name a few. Until the technical strength of this group is arrested it can be said — as the Canadian O,ls go so goes the American Stock Exchange Index. Dow-Jones Industrials (1200 p.m.) 846.85 ROBERT J. SIMPKINS, JR. S &P Composite (1200 p.m.) 100.08 DELAFIELD, HARVEY, TAB ELL Cumulative Index (3/15/79) 726.98 RJS rak No statement or expreSSion of opinion or (Iny other maNer herein contolned IS, or IS to be deemed to be, directly or indirectly, on offer or the soliCitation of an offer to buy or sell ony SeCUriTy referred to or The matter IS presented merely for the converlenCI; of the subscriber While oNe believe the sources of 01,1( informa- tion to be reliable, we In no way represent or the accuracy thereof nor of the statements mude herein Any action to be takcn by the subsc(lber should be based on hu own Invesllgotlon and Information Janney Montgomery Scott, Inc, 0 a corporatIon, and officers or employees, may now have, or m(ly later toke, or trodes In respect to any securities mentioned In thiS or any future luue, and such position may be different from (Iny views now or hereafter expressed In thiS or ony other Issue. Janney Montgomery Scott, tnc , which IS registered With the SEC as on Investment adVisor, may give adVice to ItS adVISory and othel customers Independently of any statements mode In thiS or In any other Issue Further InfOrmohon on ony securIty mentioned herein 1 ovoiloble on request 'aaa r aa ill aaaa. aa aa Rl ill aaro Q a,a…, ……. aa D C1 ' ao ' rnD Cl gat 93 8' …. at JJQ at foot at -1,)0 Qt .139 — . Ilr 'NiT at ..tfW aL (idtl 8t. Qj'/ 8t t.tlf' I,L tt-l.JO 'em Ll. 'JfltI u.-W H MY' UJ (.L u. Me u 9L 'J30 9L .9l.-t'l! .os 9L llf1lI 9f(' 9110' Sf ,LtIl 9L-(ltfI./ 9/ 93,1 91'. ''t/f'' Sl. lJO Sf !at.! 51L LJa 91 .os Sl. 9fl\f Sl.- 'll' 9LtT' SL 9L-fl'lJ – – – F– Ill.-'JO t)J .J3S 'ttL- 'lY' tT' , a ' a 00

TABELL'S MARKET LETTER 1 J 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCI( eXCHANGE. INC MEMBER AMERICAN STOCK eXCHANGE March 23, 1979 .The m,rket newclpsing high for the ,year oJ861.31 On, the Dow-Jones Industrial -Avefage. proper-perspective'by reviewing past major (20), intermediate (10), and minor (5) market swings on the Dow-Jones Industrial Averages in the chart below. COMPDTED – DJl8 SEI sza eel 19ZB 19l1! inft 1978 1.RoI 19/9 t o e.l9Z9 lw The advance of the DJIA from 742.12 on February 28th, 1978, to 907.74 on September 8, 1978, qualifies as a major uptrend, an increase of 22.32. From this high an intermediate term correction of 13.49 carried the DJIA to a low of 785.26 on November 14, 1978. From the November, 1978, low through yesterday'S close the DJIA has re-established the uptrend which was briefly interrupted by the minor decline between January 26 and February 27 of this year when the Dow-Jones Industrial Average declined 6.14 from 859.75 to 807.00. As was mentioned in last week's market letter, a posting of 860 on the DJIA would clearly signal an upside breakout on our pOint and flgure charts. Let us examlne the objectives indicated more closely. Our five-point unit and ten-point unit charts of the DJIA are shown on the reverse page. Two sets of upslde objectives appear logical and can be instructive. The first set of objectives indlcates 880-885 on the ten-pOint unit and five-point unit charts respectlvely. These objectives were determined prior to the January 26-February 27 decline earlier this year. Slnce then, the short-term decline has broadened the potential base increasing the upside objectives to 930-940. It is interesting to note the first set of objectives 109ically counts into overhead supply in the 870-910 area whlle the latter set of objectives counts into new high territory. As stated earlier, the upside breakout of 860 has occurred. Utilizing point and figure analysis, two possible senarios have been developed to measure the extent of the potential upside move. Either set of objectives seems plausible. However, time will be needed to determine which one will be operative. Dow-Jones Industrials (1000 a.m.) S &P Composite (1000 a.m.) Cumulative Index 3/22/79) RJS rak 31 101.67 738.44 ROBERT J. SIMPKINS, JR. DELAFIELD, HARVEY, TABELL No statement or expression of opinion or any other mailer herem contolned U, or IS to be deemed 10 be, directly or indirectly, on offer or the soliCitatIOn of on offer to buy Of sell any lecunty referred to or mentioned The mOiler IS presented merely for the conver'lenCE; of the subSCriber While we believe the sources of our information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude he'em Any action to be taken by the subSCriber should be based on hiS own investigation and Information Janney Montgomery Scott, tnc. as a corporatIon, and ItS officers or employees, moy now have, or may aler lake, positions or trades m respect to any securities menlloned m thiS or any future Issue, ond such POSItion moy be different from ony vIews now or hereofter expressed In thiS or any other Issue Janney Montgomery Scot!, tnc, whICh IS registered wllh the SEC as an Investment adVisor, may give adVICe to Its Investment adVISOry and other CVstomers Independently of any statements mode m ,I'lIS or m any other Issue Further Infarmatlon on any security mentioned hercm IS ovollable on request Ico .00 … ——- POINT DJII 700 DOW JONES INDUSTRIAL INDEX 1977 5 POINT DJII

r r TABELL'S MARKET LETTER L-. 909 STATE ROAD. PRINCETON. NEW JERSEY 08!540 DIYIBION OF MEMBER New YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE March 30, 1979 . The . below h!ll'!. py,,!s.i.n. Rast as an f–the kmd of thought process that–ought' t6– go- into-investing;- It can, -actually, be gener-al- lzed to a great many situations beyond the stock market since it is designed to illustrate the problems involved in any situation where one is forced, as is the case in the investment pro- cess, to make decisions in the face of uncertsinty. As the vertical columns of the table illustrate, there are two possible states of the stock- market world, i. e., the true direction of the market at a given time may be either up or down. While one may have an opinion, founded or unfounded, about this direction, that opinion none- theless will fall short of absolute certainty. Likewise, in this admittedly over-simplified case, there are two possible postures as regards equities — one may be either long or not long. The four possible combinations of world-states and decisions result in two ways to be right and two ways to be wrong. The two wrong boxes are analagous to two sorts of investment risk. It is always possible, in the simplified environment illustrated, to shield oneself entirely from one of the two MARKET DIRECTION risks. For example, it is possible to protect oneself com- UP DOWN pletely agsinst the possibility of stocks going down simp- ly by not owning them. By definition, however, such procedure necessitates full exposure to the opposite risk — that of missed opportunity in a stock market that rises. rig h t wrong In the real world, of course, it is possible to trade off one risk agsinst the other in an almost-infinite series of III gradations — but always with the proviso that it is never without – total' other. We raise this issue once more at this time because we detect, we think, today, what amounts almost to an ob- session with one of the two risk areas, the risk that the stock market may decline, indeed, decline substantially. For the past year, works of both fiction and nonfiction dealing with impending economic disaster have been featured on the standard best- seller lists. The latest mini-growth industry appears to be so-called gloom-and-doom-seminars, sessions at which presumably rational investors pay substantial sums of money to hear an intermidable series of speakers assure them that the world is coming to an end. Out in the fever-swamps, fort- resses are being constructed for protection against the depredations of a crazed and starving populace. Even in the relatively staid world of institutional investing, record levels of cash abound. What may be called disaster-chic seems to have become the order of the day. What the table suggests, of course, is that there is another sort of stock market risk, the risk of not taking advantage of a stock market which advances substantially. There is a popular aphorism reminding us that we only go around once, and there are, in each investor's lifetime, a limited number of bull markets. Fsilure to take advantage of these limited opportunities is, in the long run, as detremental to successful investment as failure to recognize the risk of loss. It is this recognition that we see being regularly ignored at present. We will enter at this point the necessary disclaimer that none of the above is to be taken to forecast the imminence of a major bull market — or at least the immediate imminence of one. We are, we hope, just as aware of the problems, technical and .rl,lndamental, confronting both the economy and the stock market as are the few thousand or so pundits who enumerate them regularly in reams of print. We do not in view of these factors, we confess, see the likeli- hood of the stock market's moving immediately to substantially higher levels. Nonetheless, the technical situation, as we see it, is not one subject to massive- deterioration and, indeed, over time, seems susceptible to improvement, perhaps, indeed, to dramatic improvement. It is perhaps just the sort of market one would expect in an era where disaster-chic has become fashionable. Dow-Jones Industrials (12;00 p.m.) S & P Composite (12 00 p. m. ) Cumulative Index (3/29/79) 863.91 191. 75 745.30 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL AWT;rak ,- No stglemenl or expn!Ulon of opmion or Qny other matter herein contmned IS, or 1 10 be deemed to be, directly or Indirectly. an offer or the soliCitation of on offer to buy or sell ony secunly referred 10 or mentioned The moiler 1 presented merely for the converllena. of the subscrtber Wh,le we believe the sources of our mformo t,on to be reliable, we ,n no way represent or guarontee the occuracy thereof nor of the statements mude herem Any octlon to be token by the subscriber should be bosed on hiS own Investigation ond mforma1ron. Janney Montgomery Scott, Inc, as a corporation, and Its olf,cers or employees, moy now have, or may loter take, pOSitions or trades In respect to any seCUrities menltoned In thiS or any future Issue, and such pOSition may be dilferent from any views now or hereafter expressed In Ih,s or any other Issue Janney Montgomery Scott, tnc , which IS registered With Ihe SEC as on Invulment adVisor, may give adVice to lis Investment adVisory and othel customers Independently of ony statements mode In thiS or In any olher Issue Funher information on any secunty mentioned herem IS avolloble on request

TABELL'S MARKET LETTER – ……….. . .011 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE !B-st analYsis of April 6, 1979 WALL STREET JOURNAL contained, a atlle! penetrating bit of economic iri .the . It – that those payments, recently at least, had kept pace with the concomitant record-high rate of inflation. The dividend-inflation relationship is not, in our view, quite as optimistic as the JOURNAL ariticle might have suggested. (The article referred to total dividend payments while the study below uses dividends on the SiP 500.) Nonetheless, a hard look at the dividend history of the last thirty years does, indeed, suggest a rationale for common stocks as an investment at a time when historically high interest rates generally exceed the yields available on equities. The chart below traces the history of the dividend on the SiP 500-Stock Index since 1947 ex- pressed in constant 1967 dollars. The deflator used is the Consumer Price Index. 00 3.80 5&0 500. 3.60 3.0-1.0 3.20 3.00 2.80 2.60 '' To get the bad news out of the way first, the chart quite clearly shows that dividends failed, generally, to keep up with inflation during, roughly, the period of the mid-1960's to the mid-1970's. Inflation-adjusted dividends for the SiP 500 reached a high of 2.95 in the third quarter of 1966 and have not since exceeded that figure, having remained recently around the 2.50 level. However, as the JOURNAL article points out, performance of late haa been more impressive. In the first quarter of 1976, real dividends were at 2.20 in 1967 dollars and have moved ahead some 13 to date. The most important fact shown by the chart above, however, is the fact that over the past 32 years dividends, even after inflation-adjustment, have generally been rising. The calculated trend channel shown on the chart has been increasing at the rate of 1. 92 annually and, aa the chart shows, real dividend growth adhered very closely to its trendline figure from the early 1950's to the mid-1970's. The rise of the past couple of years, especially in view of current historically low payout ratios, sug- gests that dividends might return to their rate of trendline growth. Now, dividend growth after inflation adjustment of close to 2 is, to us, a fairly impressive figure. If one calculates the value 01'the discounted caah flow of dividends rising at this rate versus the pre- sent price of the SiP 500 it suggests a return — in real purchasing power, remember — of 4.44. This is a return which is certainly not matched by 10 short-term money in an era of double-digit in- flation and, indeed, difficult to equal in most readily-marketable investments. It is an ironic fact, at a time when common stock prices have been depressed by inflation fears, that common stock income may well be one of the better available protections against that inflation. Dow-Jones Industrials (1200 p.m.) 877.25 ANTHONY W. TABELL S&P Composite (1200 p.m.) 103.27 DELAFIELD, BARVEY, TABELL Cumulative Index (4/6/79) 754.22 AWTrak No statement or exprenlon of opinion or any other molter herein contolned Is, or IS 10 be deemed to be, directly Of mdlrectly, on offer or the sollcltotlon of an offer to buy or sell any security referred to or mentioned Tne matter IS presented merely for tne convenience of tne subscriber While we beheve the sources of our Informo tlon to be reliable, we In no way represent or guarantee the accuracy tnereof nor of Ihe stolements mode nerem Any action to be token by the subscriber should be based on nls own Invesllgohon and Informallon Janney Montgomery SCali, Inc, as a corporation, and Its officers or employees, may now have, or may later lake, positions or trades 1n respect 10 any seCUrities mentIoned m thiS or any future Issue, and such POSition may be ddferent from ony vIews now or hereafter expressed 1n thl or ony olher Issue. Janney Montgomery Scott, tnc , which IS regIstered With the SEC as on Investment adVisor, may give adVice to lIs Investment odv15.ory and othel customers Independently of any statements mode 1n Ih,s or In any other Issue Further information on any securlty menlloned herein IS aVailable on request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCI( eXCHANGE April 12. 1979 '- profoundl!lk .0C!teresLin.common stocks ,-'; ,as ,exemplifi,ed,by 0 best-selling books on the coming disaster' and record' levels of-institutional cash the stock market. with its usual perversity. continues to edge higher. Until interrupted by disappointment with IBM's earning results on Wednesday. most indicators had spent the prior two to three weeks posting a successive series of modest new highs. and there is little doubt, in our view. that we are. for the time being at least. in an uptrend of intermediate-term proportions. The two basic questions which require answering at this stage center around how far the uptrend is likely to continue and what will be its significance in the longer-term pattern. HindSight suggests that the present advance had its antecedents in the last two months of 1978. The Dow had reached a peak of 907.74 in early September and from that high declined. sharply and somewhat unexpectedly. to new lows at the end of October. It is now quite apparent that November and December, 1978. constituted a base formation the upside penetration of which took place in the traditional year-end rally which began in last December and continued rather steadily to reach a high of 859.75 in late January. At that stage, some uncertainty set in. as the market turned down to attain a February 27th closing low of 807 on the Dow. At that level. however. most downside objectives had been reached, and it became apparent that the February decline was nothing more than a conventional test of a previous base following an equally conventional up-side breakout. By mid-March, the January peak had been exceeded, and the upswing which began last fall remains in force. If the interpretation outlined above is indeed the correct one, we must return to the November-December base formation in order to ,measure the possible upside potential of the ' current' move. The-most 'narrow andpes'srnlisfic 'ol'ijectiveCirtllat'1lase-suggests rioWng'more – ' than a target in the vicinity of the September high — something in the 880- 900 range versus the September peak of 907.74. More optimistic readings of the base formation, including February's action as part of the accumulation area, would suggest that the September high will be exceeded with upside targets approximately in the vicinity of 940. These targets might be reached as summer stren,gth, a pattern with some seasonal reliability, once more exerts itself. While it would be mildly encouraging to see the September high penetrated. we do not. at the moment, think that it is crucial. The recent trading with the most overriding significance is, in our view, the original top area from which the 1976-1978 decline began. That trading centers around the 960-1010 area and constitutes only the most recent example of the barrier around the 1000 level that has turned back upward movements in the Dow repeatedly over the last ten years. We freely confess that, -at the moment, we can find no convincing technical reason suggesting that the present upswing will penetrate that barrier without 'further maturation of the pattern. This might take the form of a moderately-severe decline from whatever high is reached 011 'the current move, a decline which might indeed carryall the way back to a test of the most recent lows. It might, alternatively, take the form of a consolidation which might occupy much of the second half of 1979 followed by a renewed attempt to penetrate the supply early next year. One form we do not think it is likely to take is the form long-awaited by the super-pessimists, that of a move through the lows of February, 1978. A pattern suggesting such action might develop but it most emphatically has not done so at the moment. Based on the available statistics, large numbers of investors. attracted by record-high interest rates have chosen to wait out the current period of uncertainty with large holdings of non-equity investments. We are in complete agreement as far as the uncertainty of the current environment is concerned, but we are just as happy, considering the current uptrend and the uncertain severity of any subsequent decline, to do our waiting with fairly ag-gressive equity commitments. Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p.m.) Cumulative Index (4/11/79) AWTrak 871.12 102.22 751. 63 ANTHONY W. TAB ELL DELAFIELD. HARVEY. TAB ELL No statement or expresslon of opinIOn or any other matter herein contolned IS, or IS to be deemed to be, directly Of indirectly, on offer or the soliCitation of on offer to buy or sell any security referred to or mentioned The moiler IS presented merely for the converlence of the subscrIber WhIle -He belIeve the sources of our Informa- t,on to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude hore, Any acllon to be laken by the subSCriber should be based on hIS own investIgation and information Janney Montgomery SCali, Inc, as a corporohon, and Its offICers or employees, moy now have, or moy laler lake, pOSItIOns or Hodes In respect to any mentIoned In Ihls or any future Issue, and such POSitIon may be dIfferent from any views now or hereafter expressed m thIS or any other Issue. Janney Montgomery Scotl, Inc, whIch IS reglstorcd Wllh the SEC as on Investment adVIsor, may gIve adVICe 10 lIs Investment adVIsory and othel customers mdependently of any statements mode In thiS or In any other luue Further ,nformat,on on any secunty mentIoned hereIn IS available on request

TABELL'S MARKET LETTER I' ,. 909 STATE ROAD, PRINCETON, NEW .JERSEY 08540 DIVISION OF MEMBER New VORK STOCK EXCHANOE, INC MEMBER AMERICAN STOCK EXCHANQE April 20, 1979 The subject of petroleum has been much in the news of late, most recently highlighted by the jIIlnounce-m.J!I'lt crfPli1!eoirt-decontrorordomestic oirprices. -This being a tecfiiiicaI letter, we will not comment here on the wisdom of the proposed policy, which involves, as far as we are able to understand it, encouraging oil exploration by making it more profitable and then taxing away the resultant profits. Whatever the fundamental situation, however, the price behavior of oil stocks constitutes an appropriate area for technical comment, if for no other reason than the fact that these stocks, perhaps more than any other similar group, form an important element of the overall stock market equation. Many investors, we suspect, do not realize the extent to which the size of the major oil companies causes them to influence the behavior of the capital-weighted Standard 110 Poor's 50o-stock Index. The total market value of the 500 stocks in that index is some 659 billion, and of this, 107 billion, or 16.3, is accounted for by 20 oil stocks. The largest of them, Exxon, constitutes 3t of the index, and no fewer than 7 issues each constitute more than 1 of the index by themselves. These figures, moreover, do not include the related Oil Well Equipment and Offshore Drilling stocks, which, collectively, constitute another 2.8 of the index. As the chart below indicates, this major component of the stock market has, indeed, behaved in an exemplary fashion of late. S&I' SOO – — –'—/ OIL DDt-tESilC The chart shows the action of the S IIoP 500 since January 1976 together with ,the two major oil indices, Domestic and International. Below each index is plotted a relative strength line, showing the action of the group in relation to the S&P. As can clearly be seen, both the domestic and international indicators have moved sharply into new three-year high territory, despite the fact that the 500 remains well below its September high. Both the oil indices exceeded that high some time ago and have recently been able to post new peaks above their best levels of 1976-1977. Needless to say, this has caused sharp uptrends in the relative strength for both areas. Although the stocks may be vulnerable to temporary correction, this superior relative action shows no signs of abating, and technical work suggests that oil stocks should continue to demonstrate above- average performance. Since these issues are a major component, this could be, in our view, an augury of further market firmness. Dow-Jones Industrials (1200 p.m.) S&P Composite (1200 p.m.) Cumulative Index (4/20/79) 852.22 100.94 746.20 ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL AWTld No statement or expreSSion of opIniOn or ony other motter herein contolned IS, or IS 10 be deemed to be, directly or indirectly, on offer or the SoliCIlotlon of on offer to buy or sell any security referred to or mentioned The moiler 1 presented merely for the convenumce of the subSCriber V/hde -He believe the sources of our IOformo tlon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any action to be laken by the subscnber should be based on his own inVestigation and Informal Ion Janney Montgomery Scott, Inc, as a corporalton, ond Its officers or employees, may now have, or may loler lake, posilions or trodes 10 respect to ony secufltles mentioned In thiS or ony fulure ISSUe, ond such POSition may be different from ony views now or hereafter expressed 10 thiS or any other Issue Janney Montgomery cott, Inc, whICh IS registered With Ihe SEC as on Investment odvisor, moy grve advice to 1/5 Investment odYlsory ond othel customers Independently of ony stotements mode In thiS or tn ony other Issue Further tnfOrmotlNI on ony secuflty mentIOned herein IS available on requesl

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER New VORl( STOel( EXCHANGe, INC AMER\CAN STOCK EXCHANGE April 27, 1979 -. -,! —; …-. -h… —– – — It is an occastional rite of spring in these pages to comment on the FORTUNE magazine compilation of the 500 largest industrial corporations. We are not sure why the listing, which appears each May, fascinates us so. Perhaps, it is because, as we have often confessed, we are numbers freaks, and the 500 collection provides us with no fewer than 20 pages of nice, juicy numbers to work on. On the other hand, possibly, the reason is that, this being a technical market letter, we have very little opportunity to deal with fundamentals, and it is fun to come at them with the sort of naivete, Which our COlleagues, who are more accustomed to this exercise, find difficult to achieve. Not being fundamentalists by profession ourselves. we can view FORTUNE's numbers as sort of a man-from-Mars, seeing them for the first time. As in the past, we found it interesting, this year, to look at the top ten companies in a number of categories which the compilation lists, especially those categories relating di- rectly to common stock performance, rather than size. Let us, for example, consider the leading ten companies in terms of earnings-per-share growth for the ten-year period ended in 1978. They are, for the record, Wheelabrator-Frye, Fairchild Camera, A-T-O Corporation, NVF, National Semiconductor, Teledyne, Peavey, Peabody International, Natomas, and Digital Equipment. It is an interesting list, to be sure. As has universally been the case, when we have made such an examination, the names do not turn out to be the ones that would be likely to appear on the typical list of favored growth stocks, the last one, DEC, being the only possible exception. The reality of growth, it appears, often exists without its image. On the other hand, for the first time since we have looked at these figures, they support a strong case for the rationality of the stock market. Very often, in the past, when -companies, -theirrecent -price pel'IoFmance .. – , has been fairly dismal. In 1974, for example, we isolated the terr fastest-growing companies for the ten-year period ended 1973. (Wheelabrator-Frye, incidentally, is the only one that made the list both then and now.) An investment in those ten issues in 1973 would have declined by some 45 over the year, not precisely the sort of response to growth that one ex- pects. As we pointed out then, however, the reason lay in the fact that, in the early 1970's, companies with high growth rates 'were selling at astronomical multiples, in many cases over 50, and 1973 turned out to be a year in which multiple reevaluation took place. By contrast, 1978 found most stocks reasonably valued, and the price performance of the ten companies listed above was distincly above average. FORTUNE computes the total re- turn, capital appreciation plus dividends, on each of the 500 companies, and the median was 7.16. For comparison, not including dividends, the Dow was down 3.1 on the year and the S&P Composite up 1. 1. Nine of the ten companies listed above bettered the 500 median, and the return on an equal investment in each of the ten companies involved would have been 22.8. Ten-year figures on total- return were available for nine of the ten companies, and seven of these showed returns well in excess of the median figure. What needs to be stressed, we think, is that in our years of looking at the 500, which cover the decade of the 1970's, 1978 was the first case in which the sort of results referred to above were obtained. The point we derived from previous analyses was that not only growth rates, but comparative valuation had to be taken into account if price performance were to be successfully predicted. In a market such as the current one, where more reasonable historic valuations prevail, price performance may turll out to be more responsive to improving funda- mentals. Since these valuations have not changed all that much over the past year, we would suspect that such may be the case in 1979 also, and we will look forward to FORTUNE's issue of May, 1980, to see if this is, in fact, the case. Dow-Jones Industrials (12 00 p. m.) S&P Composite (1200 p.m.) Cumulative Index (4/26/79) AWTld 856.90 101. 66 749.93 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL I No stalement or expression of opmlon or any other motter herein contolned IS, or IS to be deemed to be dlrcCTly or indireCTly, on oHer or thc soliCitation of on offer to buy or sell ony SCCl,mly referred to or mentioned The motler IS presented merely for the corlVellence of Ihc subSCriber Whda we. believe the sources of our Informo tlon to be rehoble, we In no way represent or guarantee the occuracy thereof nor of the statements mude herein Any action fo be token by the subscnber should be based on hiS own investigation and information Janney Montgomery &011, Inc, as 0 corporation, and lIS officers or employees, may now have, or moy later tak.e, posItions or trades In respect to any seCUrities menlloned In thiS or any future Inue, and such position may be different from any views now or hereafter expressed In or any other Issue Jonney Montgomery &ott, Inc, which IS re.glstered With the SEC os on Investment adVisor, may give adVice to Its Investment adVISOry and othel customers rndependenlly of ony stolements mode In thiS or In any other ISSUI! further InformatiOn on any security mentIOned hercln IS ovallable on requl!!'1

I TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE – — …..-.. –, ..-. ………. '1 – .- , – -,,–;;;-.,..,. .-, ' – – , ……… …. 4 …- ,……. , May 4, 1979 There exists an old story about some Oriental entrepot, where a flourishing market developed in boatloads of canned sardines. These sardines were traded back and forth at ever-increasing and more widely fluctuating prices among various participants. One day, a buyer, more curious than most, decided to inspect his purchase, and opened a can of his sardines, which turned out to be totally rotten, whereupon he complained loudly to the seller. The response was, You fool, those aren't eating sardines; they're trading sardines. The story, of course, is intended to illustrate the difference between intrinsic and market value. The former derives from economic utility. The latter is simply a function of what buyers are willing to pay for a given good. An extension of the trading-sardine concept is the greater-fool theory. Under this theory, it makes sense to be fool enough to buy an item at an inflated price, if one expects to find a greater fool who will take it off one's hands at an even higher price. The existence of such a phenomenon as the sardine market described above depends on the availability of a sufficiently large group of greater fools. Trading sardines, as opposed to eating sardines, exist in almost all times and places, and an interesting question is, What are today's trading sardines There have been times in the past, of course, when common stocks took on many of the necessary attributes. Not totally, of course, since most equities usually possess some residue of intrinsic value. How- ever, market prices have, on occasion, become so unrelated to that value that the prices could be sustsined only by the continued existence of large numbers of purchasers who con- tinue to.gelugEl,.tlWll!l!lIXes, theory, …,.. 1 1929, certsinly, was an example or-such a case, and it is arguable that the prices of many growth stocks in the early 1970's constituted a similar example. The denouement in such in- stances is, of course, inevitable. It would be hard to sustsin the argument, however, that common stocks possess these attributes today. We see, indeed, in the raft of corporate takeovers, probably the unique financial phenomenon of the past couple of years, evidence that precisely the opposite may, in fact, be the case. The corporate acquisitor is manifestly interested in the real economic value, as opposed to the market value of a given enterprise. He is, in other words, interested in eating sardines, rather than trading sardines. Unless large numbers of corporate bidders are collectively stupid, the market value of many stocks today is significantly belOW their value to buyers as ongoing enterprises. Where, then, do today's trading sardines exist In light of the relatively poor record of conventional investment media over the past decade, many advisors have, of late, been touting the merits of some relatively arcane commodities as havens for investment funds. Gold, of course, has had its adherents for years, nay, even centuries, but creative imaginations these days are soaring far beyond the hoary barbarous relic. Diamonds, for example, to judge the proliferation of advertisements and the emergence of a group of questionable dealers, are apparently attracting increasing interest. All manner of so-called collectibles are coming to the fore, including a number with some rationale, such as Chinese porcelsin and Impression- ist psintings, and an equally large number w.hich make no sense whatsoever, i.e., Mickey Mouse watches. Now, in discussing the investment merits of these items, one can get sidetracked into' all' sorts of peripheral questions, involving scarcity, aesthetics, etc., etc., and there is insufficient space to get involved in these here. It is, however, we think, obvious that the price of many such items depends upon the existence of buyers, rather than a real economic usefulness. Some exotic investment media have done extremely well in the past; indeed, over fsirly protracted periods in the past. They may continue to do so in the future. We will, however, confess to our own old-fashioned prejudice for investments where an economic rationale for current pricing apparently exists. Dow-Jones Industrials (12 00 p.m.) S & P Composite (1200 p.m.) Cumulative Index (5/3/79) 855.60 101.65 748.88 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL AWT ld No statement or expreulon of opinion or any olher moiler herein contolned IS, or IS fa be deemed 10 be, directly or mdlrectly. on offer Of the solicitation of on offer 10 buy or sell any security referred to or mentIoned The moiler IS presented merely for the convePlenC!l of the subscrIber While we believe the sources of our Informo tlon to be rehoble, we In no woy represent or guarantee the accuracy thereof nor of the statements m..,de herein Any actIon to be token by the subSCriber shOUld be based on hIS own investigatIon and Information Janney Montgomery Scali, Inc, as a corporatIon, and Its offIcers or employees, may now hove, or may later toke, poslteon! or trades In respect 10 any secuntles mentioned In thIS or any future Issue, ond such posItIon moy be dIfferent from any views now or hereafter expressed In th'5 or any other Issue Janney Montgomery Scott, Inc, which 15 registered wl,h the SEC as on Investment adVIsor, may give adVICe 10 liS Investment adVISOry and othel customers Independently of any statements made 10 th.s or In any other .uue Further tnformatlon on any secunty mentioned hereIn IS avalloble on request

– – – – – – – – – – – – – – – – – – – – – – – — —- r TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY OB540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGe. INC MEMBER AMERICAN STOCI( EXCHANGE May 11, 1979 -h!', … … ….—…… -.!.,-oo '-!..—- As May-June, not always one of the best periods for the stock market, approaches this year, the major averages have embarked on yet another instance where a trend apparently in effect has failed to follow through. The Dow reached a closing high at 877.60 back in early April and, after another attempt at that high at the end of that month, broke sharply to close at 833.42 on May 7th, a day on which more than 1,400 issues declined. Further lows were posted on heavy volume on Thursday and early Friday. The weakness was all the more disappointing, in that it occurred shortly after the index had penetrated its previous minor-trend high of 859.75 scored ll\st January, thus establishing an upswing of intermediate-term proportions. To date, however, the technical damage cannot be said to be serious. So far, the two previous benchmark lows, 807.00 on February 27th and 785.26 on November 14th, remain intact. At the moment, technical evidence does not appear to suggest a downside penetration of either of these lows, with the most plausible targets for the Industrials centering around the 820 area. Were either of the two nadirs mentioned above to be penetrated, so the conventional wisdom runs, the stage would be set for an attack on, and possible penetration of, the starting low for the whole upswing, the one scored on February 28, 1978, at 742.12. Many of our col- leagues suggest the likelihood of just such an event, preferring to call the entire process that began in February, 1978 a bear market rally within the context of a downswing that began at over 1000 on the Dow in 1976. There exists, we are prepared to admit, some evidence in favor – -of sucha case we-have-, failed — bearish evidence so adduced is couched in terms of the familiar four-year cycle, and it is inter- esting that the time appears to be running out on this argument, thus, perhaps, accounting for some of the nervous stridency of those of bearish persuasion. The cycle referred to, it will be recalled, runs from trough to trough, and its average length in the post-World-War-II period has been slightly more than four years (51 months). If one looks at the entire twentieth century, the average length becomes a good deal shorter, 42.3 months to be precise. The central argument, still not fully resolved, hinges on whether or not February, 1978 constituted a low in terms of this cycle. Since the previous low point (OctoberDecember, 1974) is known, a February, 1978 cycle low would mean a cycle length of 40-42 months, a length, it is regularly noted, unprecedented in the past 35 years, but, it is less regularly noted, not at all unusual if one takes the longer view. The alternate theory, that the low is yet to be seen, now finds itself running up against a time deadline. The longest cycle on record in the twentieth century is 60 months, and that length from the fall of 1974 takes us, of course, to the fall of this year. Believers in this theory, therefore, need substantial weakness, and need it in a hurry, in order to prove their case. Now, such a phenomenon as the four-year cycle is as much a theoretically interesting device as a practical one, and there exist, we will be the first to admit, complexities in the present case. A great many of these complexities center around the absence of a benchmark low, comparable to February, 1978, for most broad-based indices, which have essentially been in an upswing since the 1974 lows, at least through last September, and, in the case of the American Stock Exchange Index, until just recently. Nonetheless, we have been able to resist the rally-in-a-bear -market interpretation of the period since February, 1978, and the passage of time, we suspect, will make such resistance still easier. Dow-Jones Industrials (12 00 p. m.) S & P Composite (1200 p.m.) Cumulative Index (5/10179) 829.78 98.46 718.58 ANTHONY W. T ABELL DELAFIELD, HARVEY, TABELL AWTld No statement or expression of opinion or any other matter here'n contOlned Il, or IS 10 be deemed to be, directly or Indirectly, on offer or the soliCitation of of offer hI' Idb'to buy or sell ony security referred 10 or mentioned The motter IS presented merely for the COfWel'lenCI9 of the han to be reliable we In no way represent or guoronlee the accuracy thereof nor of Ihe statements m….de herein While we believe Any action to be toh.en y t heousurbssconfbeoru,rs t au t k e based on hiS own'lnvestlgotlon positions or trades In respect to and Information Janney Montgomery ony securlhes menllaned In thiS or ony Scott, future Inc, as a Issue, and corporation, and Its offtcers or such pOSition may be different employees, may from any views now now ohrOhee,reoarf/meray a er 19, thin Ih,s or any olher Issue Janney Montgomery cott, Inc, whICh IS reglslered With Ihe SEC as on Investment adVisor, may give adVice to It Investment a VISOryt on a 191 customers Independently of any statements mode In Hus or In any other Issue Further Information on any seo,lIIly mentioned herein IS available on reques

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW VORk STOCk EXCHANGE, INC MEMBER AMERICAN STOCI( eXCHANGE -\ May 18, 1979 – – commented on the rather obviOus downtrend phase'; which, we now know by hindsight, began at the early April high of 877.60 on the Dow. We went on to suggest that the April-May weakness, while it constituted a somewhat disappointing development, did not appear to have an unduly serious downside potential, and we mentioned 'that the most plausible downside targets appeared to center around the 820 level on the Industrial Average. That low was approached, if not actually reached, in this week's trading. A closing bottom for the move was chalked up on Monday with a final posting of 825.02. Tuesday and Wednesday showed somewhat better closing figures, but intraday lows around 821 were attained on both days. While all this was going on, most short-term oscillators were approaching reasonably deep oversold territory. Short-term indicators based on percentage change and on advances and declines both reached oversold conditions comparable to those attained in mid-February, suggesting that the recent declining phase may well turn out to be of approximately the same magnitude as that correction. The February decline, it will be recalled, took the Dow roughly from 860 to 800 over about a four-week period. With downside objectives having been reached and an oversold condition having been attained, the market posted a fairly dynamic Thursday rally, moving up over 14 points to close at 842.95 with prices gradually improving during the day. Quite obviously, with short-term lows having been made this week, no base supporting a meaningful advance now exists. The rally, however, — We are inclined to think this to be the case, and, if it is true, it is worth reminding ourselves of a market axiom — that it is the character of short-term rallies within an uptrend that suggests the deterioration or lack of deterioration within that uptrend. As we noted last week, a good deal of the April-May disappointment stems from the fact that a new high for the move from the lows of last fall had just been posted. If another upswing has indeed begun, it would be hoped it could demonstrate its vigor by ultimately moving above the April high and confirming the existence of a six-month upswing. Failure to do so, on the other hand, would have to be viewed in a fairly serious light. Different patterns are displayed at the moment by the various market components although they all have the common denominator of having reached short-term downside targets at recent lows. As we have stated in the past, the Dow Jones Industrials, on the strength of the base formed last fall, have an upside target in the 900-940 range, and current prices find that index on the support provided by the October-December base. The Transportation Average, which had been a feature on the upside prior to the onset of weakness a month ago, has, on an intermediate-term basis at least, an even more constructive pattern. The top formed was small, and its downside objective was clearly reached at the recent low around 220. The eventual upside target remains at the 242-250 level versus a current level of 228. The Utilities, on the other hand, show a much less dynamic but potentially interesting pattern. This group, it will be remembered, has been in adowntrend since reaching its high in 1977 at , around 118;-and it moved as low as 97 last fall. Last week's low of 98.07 on Tuesday tested that level and also represented the attainment of a downside objective. Were the prior low to hold, the possibility of a six-month base with worthwhile uspide objectives would become a real one. Since the group is essentially interest-rate sensitive, this could have fairly important implications for the general market as well. Dow-Jones Industrials (12 00 p. m.) S & P Composite (1200 p.m.) Cumulative Index (5/17179) 842.86 100.03 724.37 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL AWTsla No statemenf or expression of opinion or any olher motter herein contolned IS, or IS 10 be deemed 10 be, directly or 'ndHcc!ty, on offer or the 501llollon of on offer to buy or sell any security referred to or mentioned The maller IS presented merely for Ihe converolcnce of the subscriber While we believe the sources of our Informotlon to be reliable, we In no way represent or guarantee the occurocy thereof nor of the stotements mude herein Any aeilon to be token by the subscriber should be based on hiS own investigation and information Janney Montgomery Scoll, Inc, as a corporotlon, and ItS officers or employees, may now have, or may later toke, paslhons or trades In respect to any securlhes mentioned In 11'115 or any future Issue, and such position may be different from any views now or hereafter e)rpressed In thiS or any other IHue Janney Montgomery Scott, Inc. whICh IS registered With the SEC as on Investment adVisor, may give adVice to Its ,vestment adVisory and othel customers Independently of any statements mode In thiS or In any other Issue Further ,formatIOn on ony serunty mentioned herein IS available on request