Tabell’s Market Letter – January 29, 1954

Walston &- Co. MEMBERS NEW YORK STOCK EXCHANGE AND OTHER LEADING STOCK AND COMMODITY EXCo-iANGE'. NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO LUGANO iSwd,I,d) OFFICES COAST 10 COA;T CONNECTEr; BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LEnER January 29, 1954 Improved inve3tment sentiment touched off by incentive tax proposals has caused me to alter my earlier projections on the 1954 market time table. I looked for the Dow-Jones industrials to reach 325 by the year end with an intervening reaction to 270-265, but I now feel that the average will reach 295-300 followed by a correction to only 285-2BO and that the 325 level will be reached by ummer or early fall. Below are two issues that aooear technically attractive. NATIONAL GYP''Uf1 Current -Market Current Dividend 22 1. 1/2 40 27 stk. The company is the second largest producer of gypsum building mate- Current Yield 6.2 rials. It is aggressively expanding its interest in other building line Funded Deb't 28,500,000. During 1952, the company acqUired Preferred Stock 10,000,000. Wesco Waterpaints for 118,341 share Common Stock 2,664,872 shs. of stock and in 1953, Asbestone and Smith Asbestos Products were ac- Net Per Share 1953 2.75 (est.) quired for 265,907 shares. To in- Net Per Share 1952 Sales 1953 (9 mos.) Sales 1952 (9 mos.) 2.84 187,800,000. 72,500,000. crease product and plant diversification, the company plans outlays of 7,500,000 a year through 1957. Current Assets Current Liabilities Working Caoital – ,,/1 Plans include pOSSible acquisition 141,7 40 ,000.-. 5,610,000 36,120,000. of additional asbestos, paint, lime 'and insulating material companies. Moderately higher profits are ex- pected,in 1954 and dividend payment Mkt. Range15i-i4 22 7,/817 5/8 shouldtcontinue at the 1.40 rate. 2 in stock was paid on January 4th, 1954. The stock has an excellent technical pattern. It has held in the 23-17 area for three years. This appears to be an accumulation range and an upside penetration would indicate 32-35 followed by a later 42. There is downside support at 20-18. The upside percentage potential appears to be 90 as against a downside risk potential of 17. The stock is recommen- ded as an excellent vehicle for long term appreciation. CORNELL-DUBILIER ELECTRIC Current Market Current Dividend Current Yield 25 1.35 5. 47 The company is a leading manufactu- rer of capacitors, the most important UEes of which are in television and radio. Color television Funded Debt Preferred Stock iCommon Stock 4,000,000. 1,230,700. 512,390 shs. sets use double the number of capacitors that go into making black and white ets. While production of black and white sets will undoubted- Net Per Share, 1953 Net Per Share, 1952 Sales 1953 Sales 1952 Current Assets current Liabilities I Net Working Capital 3.12 2.86 43,630,000. 35,500,000. 16,820,000. 6,680,000. 10,Ho,000. ly falloff in 1954, the company's other lines should hold up well and orofits should be down only moderat- ely. The statistics quoted (all of which are for the fiscal year ended September 30th) show that the stock is quoted at 8 times earnings and yields over 5.4 on a payout of 50 of earnings. Stock dividends of 10 IMkt .Range 1953-54 26 5/B-18 1/4 ) 301 quarterly plus 151 extra. were paid both in 1953 and 1952. The technical pattern of the issue is very interesting. The long term Also paid 10 stock dividend. objective is 41. Over the nearer term, the objective is 28. On the downside the stock should meet support at 20-18. Thus the upside percentage potential is 7B against a downside risk ootential of 21. The stock appears to be an interesting purchase. EDMUND W. TABELL HALSTON & CO. , pner1 r, …, 'v t… r1r1.'l1me;Ilnnd,unmlricss'n01In ,-on ,nlorm,H,,,.,,, 0 b' 'O .! In offer or sol,cltc.t,on I.so'm,..,. ed0. l ,,1 r('JIl e Itl(. bul se;ul,cS 'Tlcnllol'lcd nCOI ncCessrlly comp I ff 0 0e lheetfet.'lnI rs to The not b rI uy 0 In l! lorl!go gd guarantee IImaaln(l!a,l,chuard,esb t as accura e or e From I,me en prepared f I .!Ond s Inj!!. I to .lI by nOI mIInenlWsnd3.1a.. ,dlornT10'a&lItctrCreoc01lo or Inl st' lIln,lnmdteaplleonnoeo'nlIInnco'uIet,orvra 1