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— ——————————– , , , NEW YORK S, N Y , 35 Wall Street , DIGBY .4141 PHILADELPHIA 2, PA 1420 Walnut Street PENNYPACKER 5-5911 LOS ANGELES 13, CALIf, SAN fRANCISCO 4, CALIf, 550 South Spring Street 265 Montgomery Street MADISON 'I 22 SUTTER 12700 /, ! r' , , TABELL'S MARKET LETTER ,I;' ,',1' , '1 ', )I', It would appear that the industrial average will furnish the clue as,- ' to the direction of the nearer term price trend. While the rails last week i , 'were able to better their September high of 87.04 to reach 87.80 and are ini' I', a position to again test the February high of 90.82, the industrial average', ,,,, has acted rather sluggishly. This average reached its high in mid-September i,-at 277.51 and reacted to 269.08 later in the month. Last week's rally carrid the industrials back to 277.30. This week's low was 271.46. An upside pene-, , tration of the 277.51-269.08 trading range would indicate a continuation of' ; ,the uptrend from the July lows. A downside penetration might have consider-', ' , ably more significance and indicate a top of at least intermediate term ;'proportions. ,',' However, regardless of the action of the averages and the general (,-' market, there are a great many individual issues that have strong long term ,,, ',' technical patterns. In looking over the graphs of a number of individual ;,' ' issues showing the monthly price range Since 1929, it was interesting to note '''how many issues were selling below not only the highs of 1946, but also the ,highs of 1937. Of course, this does not mean that these issues are necessari- , ,ly undervalued or behind the market. In fact, quite the reverse is more apt ;' ,to be true. The fact that these issues have been unable to better former , , highs usually signifies a lack of growth potential. The great majority of 'growth stocks are selling above their 1929 highs as well as 1946 and 1937.' However, when a stock is selling below its highs of 1937 and 1946, ',,-, ' ,and has an upward trend of earnings plus a favorable long term technical ( , 'pattern, it merits some conSideration. Below are three issues in my recom- ,,, mended list….. AMERICAN RADIATOR 122l ',- High 29' 23 1612 -a ', , ,, ' Earnings Dividend 68 95 2.05 ' 60 40 1.25-1.59' ,.' This stock has paid continuous dividends since 1936. It has built up ;,,,' a very favorable long term technical pattern. It has held in the 10-17 po- , ''', tential base area since 1946. While no immediate move is necessarily indi- ', cated, the eventual objective appears to be an initial' 25 followed by 35. /-' ; Would buy this stock for patient long term appreciation plus good yield. /!, BURROUGHS ADDING MACHINE 1937 1946 19'51 High Earnings Dividend 36 5/8 21 3/4 1.63 '40 1.40 55 18 3/4 1.55 90 ,, ,, — Dividends have been paid since 1895. Earnings have been erratic over; , recent years and in a downtrend since 1929. However, the stock appears to f, ,have turned the corner. It held in the broad 13-17 range for over four years. – The recent upside penetration indicates a long term 31. Action may be Slow; , but the stock appears to be under accumulation and should be bought on minoe' ' price declines. I', OWENS ILLINOIS GLASS 1937 1946 1951 ',,r' I', ' High Earnings 103 3/4 100 3.51 4.53 89 6.50 , Dividend 3.25 3.50 4.00-4.25, Estimated. a – So far this year. , The stock has paid a dividend each year since 1907. Largest manufac-,' ' turer of glass containers. Has 42 interest in Owens-Corning Fibreglass CorP. ';Ii, Has favorable long term growth prospects. Recent penetration of 74-82 trading '; area indicates a possible 95-105. Good support at 80-75. Long term potentiaJL, I ,much higher. ,'- , All three of these stocks are recommended for purchase in long term ,' I capital appreciation accounts, provided there is also a large backlog of re,, ,;'', serve buying power. EDMUND W. TABELL ; October 11, 1951 Dow-Jones Ind. – 274.10 Dow-Jones Rails 86.88 WALSTON, HOFFMAN & GOODWIN ,' Thill memorandum is not to b, con,trued at lin offer or solicillltion of offen to buy or sell lin)' ,ecurlti from time to time Walton, Hofln')11 & Goco ….. ,n molY ho!lve olin interelt in lome or 1111 of thl lecurltlel mentioned herein The foregoln9 mo!ltetlal hal been prepo!lred b UI al o!I matter of Informt,,,1'\ orly I' I I.H'lu!d upon informo!ltlon believed reliable but not neceulHily complehl, is not ;uuanteed al accurate or fiul, oIInd II not Intended to loredou inf'pnder.t Irq,my \.