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INVESTMINT SlCURITIES S….N FRANCISCO NEW YORK LONCS lEACH EUREKA FRESNO MODESTO OAKLAND STOCKTON BAKERSFIELD alYERSIDE lOS AN&ELES SACRAMENTO SANTA ANA VALLEJO SAN JOSE TABELL'S MARKET LETTER 35 WAll STREET. NEW YORK 5. N. Y. Digby 44141 The market leaders of the 1942 to 1946 advance were mostly in the so-called goods or consumer goods industries. They included the retail store stocks, liquors, textiles, moving picture, airline and other industries that more or less sell directly to the public. After a sharp better-than-average rise, they had an equally sharp drop from the May 1946 highs and continued their declining tendencies much longer than groups which had not participated to such a great extent in the 1942-1946 bull market. What is the outlook for these industries today For a long time I have avoided recommending issues in the consumer goods group. In October 1946, and again in May 1947 and February 1948, when the averages entered my 160-170 buying range, I did advise the purchase of this type issue in the above groups. My recommendations were mainly in the industries with a more favorable technical background such as the oils, metals, machinery, steels, teleVision, etc. However, upon examining the technical patterns of some of the consumer goods groups ad the individual issues therein, I discover that a great many individual stocks have ouilt up exceedingly attractive technical patterns. All of these consumer goods groups have apparently reached the downside objectives outlined by the broad 1946 tops. Their declines have been extremely drastic and it would appear that many of the issues have been thoroughly oversold. In addition, some of these groups have built up sizeable potential base patterns and with any change in the present market psychology would be in a position to move ahead rather sharply. This is true particularly of the retail stores, liquors and airlines. In some of the other groups it would appear that some further backing and filling is needed before any sizeable advance could take plae. I am listing below a number of issues in the above category, together with their 1946 highs and 1948 lows and their approximate present price. I believe all of these issues warrant attention as thoroughly sold out situations with excellent prospects for intermediate term price enhancement. 1946 High Allied stores American Airlines Bone. stores Burlington Mills City Stores Distillers Seagram Eastern Air Lines Federated Dept. stores Gimbel Inter. Tel & Tel Lowenstein M. & Sons McCrory Stores McLellan Stores Marshall Field Montgomery Ward Northwest Airlines Pan-American Airways Paramount Pictures Publicker Industries Schenley United Merchants & Mfgrs. 63 3/8 19 7/8 48 1/4 29 7/13 38 1/4 30 33 3/8 41 7/8 — 55 1/8 31 7/8 43 3/4 43 35 7/8 57 7/8 104 1/4 56 1/2 27 42 1/2 67 100 23 1/8 Adjusted for two-for-one split August 1946. 1948 Low 25 6 1/8 16 1/2 16 1/2 15 1/8 13 13 7/8 20 7/8 17 8 3/4 20 25 18 3/8 22 1/8 47 1/4 8 1/4 8 1/4 18 1/4 18 25 1/2 11 1/2 Approximate Present Price 28 7 16 5/8 11) 7/8 18 15 16 27 17 9 21 30 20 23 53 9 8 1/2 23 19 29 11 1/2 I ( , These issues are in industries that have already experienced a post-war adjustment period and are i.n a strong defensive position. December 22, 1948 EDMUND W. TABELL . WALSTON, HOFFMAN\& GOODWIN This memorandum Is not to have upon anlnIonrtemr.etsltoIn IOIne or believed be; all construed 0 an of the securities offM or IOIIc1tatlon of mentioned heroin. The foofrflelrsoltno9 bvy or tell any securitleJ. From material hal been prepared by feli.. bl. but not neceuarlly compl.'e, is not guaranteed liS ac.curate or final, and tim. to time Walston.. Hoffman' Goodwin may us as matte, of Information Oftl,. It Is based Is not Intended to fof9Clole Independent Inquiry.