Tabell’s Market Letter – June 01, 1951

— ——————– Walston Hofflllan c… Goodwin.–,,,',',,,,,-,-,.' '-,',,,, ,',''' '-,-,– ..; ',,',,,–'–,'co,' .! I, r( , ' 7,,-,, 1,,1,' , ,',', , ,!';,'ji; o-p,r4t!UN2 c/eo ., Ii,,;; b;;-t NEW YORK S, N. Y l t I 35 Well Street PHILADELPHIA 2, PA 1420 Walnut Street LOS ANGELES 13, CALIF. SAN FRANCISCO 4, CALIF. 550 South Spring Street 265 Montgomery Street ' – ,01 ' '\ DIGBY 44141 ;''\(, PENNYPACKER 5S'n7 ;l5; TABELL'S MARKET LETTER MADISON 9232 SUTTER 1-2700 I t' , , '- . ii,; At Thursday's high of 251.68, the industrial average had recovered f',', kpproximately ten po;ints of the tllenty-two point dec line frol'1 the year's , i' ;'high. This should be a sufficient technical rebound. The very heavy supply !,,,ar\elaeari-tertmh e 250-255 advance. ra,;e most likely will prove to be a barrier to further If the market spends some time in tLi range, it Hill ',i i, ('9roaden the potential top formations in individual issues and in the general,', nlverages. VThen this pattern is completed, a clearer idea of the downside , l)jeC'Gi ves and buying ranges will be available. ,; f, At the moment, the next important downside resistance levels are at ;(235-232 in the inQustrial average and at 72-70 in the rails. ItIould not , 'irollovi strength but, as the decline will be extra selective and some stocks – jTill most likely reach their lows before the Generai–market j.iould-use pe- 1;' h(Piods 'of weakness to buy selected issues lith good longer term patterns. i';\ fevl issues of this type are noted below. ;X, ,/ k; 7RUEHAUF TRAILER is the \'Jorld' s largest builder of truck trailers, J.950 earnins totaled 5.59 a common share. 14arch 1951 quarter profit in,i,treased to 1. 57 against 1. 03 a year ago. The common stock has paid con- f,i, ,t',, ;'''secutive dividends since 1934 and last year the company paid 2 a share (-plus 20. in stock. At present price of 27 this affords a yield of 7.4. , 'Xhe stocle was originally recommended at the equivalent of 20. Fruehauf .;jeached a high of 31 late in 1950. The issue has an attractive technical d,'ipattern and indicates higher levels over the longer tern. Would buy on ,,,I,-,'- 'L1inor price declines, Our Research partner, lIr. H. J Soher, recently \1risited this company and copy of his report is available. h,l'', HALL PRINTING (17) has held in a narrow trading range for the last !'four years. It is priced eight pOints below the 1946 high of 25. Earnings ,; ,or the fiscal year which ended 1arch 31, 1951 have not yet been issued 'tlUt are expected to be around 2.50 a share. Hall earned 2.70 in th'e fis- )ical year ending 1948, 2.88 in 1949 and 2.43' in 1950 fiscal year. 'rhe ,, l'tor'lpany's 17 million modernization program is nearing completion and ;,',!Jhould result in increased profit margins. Hall is one of the leading ;/ (tJrinters in the nation, printing catalogues, magazines and pocket-sized ;' ioolS. The volume of this last item increased 115 ,from 1946 to 1949. Stocle , ),1s forming a very strong accumulation pattern in the 12-19 area. An upside Denetration lIould indicate 28-30. Would add it to my recommended list on ' ,,'minor p;'ice dips 0 There is good support at 15-16. A few days ago the ,',' !;'quarterly dividend rate Has increased to 32 1/21 from 251 paid in preceding i9.ue.r'ccrs. The stock will sell ex-dividend the 32 1/21 just voted on Jun 5. ;;;,Yield is over 7 1/2. Our research staff issued an excellent three-page ;;,, 'report on Hall in February. ; INTERNATIONAL TEL & TEL, (15 3/8) is a speculative issue but offers . ;-the possibility of wide percentage apprec iation, 1950 earnings were 2.38 i', e'''' share on a consolidated basis, the best level since 1929 when the stock 1,, i'sold at the totally unustified level of 149. It is selling at little HOre ,', n.than one-third of its 42.72 book value and about half its 1945 .high of 33. large proportion of its earnings are derived from foreign countries and ),'re not subj ect to excess profits taxes. It is a holding company contrcilljl; ,' tl) telephone units in South America, the West Indies and Shanhai, (2) ; radio and cable circuits mostly in Central and South America, l3) equipment, ' !,companies in U.S. (Federal Telephone), South Ar,lerica and Europe. It also ,controls Farnsworth-Capehart television and radio. Backlog of manufacturing ',',orders in the United States alone recently stood at '160 million and 85 tof this was Government business. Foreign orders ilere substantial also. iConsolidated earnings for March quarter of 1951 rose to 321iilli0n,.,or-a-bout581 a shaI'ee-aga;inst a ,share, in, the an estimated 4 first period, of, ,-.,' t;1950. Stock is a speculation on peace but also has defense economy poten- t'c' ,tials. Technically, the stock appears attractive on price dips. The ability , /to reach 17 was constructive. The stock could react to the 15-14 level ' Ilhere I would add it to my recommended list. There is an upside p,,'cential of 20-25 i!1 the pattern followed by a later testing of the 1946 high of 33. 'r, !;,June 1, 1951 EDlIJUND W, TABELL ;;, Closing Ind.Average 249.33 WALSTOiJ,HOFFMAN & GOODWIN C '' , ;J;;QJt1ijgduaaUtoVeeJf,aa;fi an o(fl'Jit&Cltation of offers to buy or SIll any I.Cuntiu From t.me to lime Wablen, Hoff,,, & GoodWin may han an Int.relt In 10m. or ,II of the (urme, mentioned her.in. The forlgolg material has b.en prepared by us 'I II maHer of information only It is baled J..i.!J, upon In'ormation believed reliable but not nlcen.,ll, complet., Is not guaranteed al accurate or final, and IS not Intended to foredose independent inquiry ;';J,;,,/,'!,,'.., -''';,\;J–;—..'// -,'-'J',,',!-,–,-, , 2J -..- , — ,- ,'-'–'—..-..'–;'– ',.r-, –, ';\\