Walston &Co. ———lnc——— Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CI-\ICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER May 6, 1960 Monday's decline to an intra-day low of 596.61 tested the March low of 596.20. The rail average also held above the March low of 137.63 at Monday's low of 137.77. Both averages advanced from the lows and closed higher on the week. The rally in the rails has just about broken the four-month downtrend line from the January high of 161.0 Ability to hold above the previous lows is an encouraging technical factor. Ability of the breadth-of-the-market index to show above average action would be, from a technical viewpoint, a most constructive development and would indicate a reversal of the down- trend that has been in effect since January. This has not yet occurred. In the meantime, individual issues continue to move against the trend. In most cases, the new highs are being made by specialty growth issues and defensive groups rather than the favorite fifty. BESTWALL GYPSUM COMPANY Current Price 42 Much has been written about the Current Dividend Stock virtues of expansion from internal cash Current Yield None flow without recourse to outside financin A company almost unique in this respect Long Term Debt None whole potentialities seem unrealized by Common Stock 2,004,281 shares the market, is Bestwall Gypsum. Bestwall is currently the third largE S Sales-1959 39,420,000 Earned per Sh.-1959 2.40 United S includin wa 1 of gypsum dsaeathing, and plast r Market Range 1960-1959 45 3/4 – 335/8 e dol company will ha rge y pleted a program which or virtual doubling of plant capacity over that which existed been achieved without recourse to 1 1. doubling of capacity will have i y '!1B; . g and with no long termdebt other than a relatively . idea of the program's magnitude may be gained by 860,000. This' c se ture figures. In 1956, the company spent ,20;9;OnOin1957, 1,820,000 in 1958, and 6,880,000 in 1959. For 19 i e -;1.fitures have been budgeted at 17,000,000. In 1959, Bestwall had sales a '1'40 million and carnings after taxes of 4,820,000 or 2.40 per common s Pre-tax profit margin was an extremely high 22 1/2. It would be logical to xpcct profit margins to increase on thc addition of so much new and modern plant, but even without this possibility, the potentials for sharply increased earnings are excellent. It has been estimated that capacity for the company with all new plant completed is an annual volume of around 80 million to 90 million. Taking 80 million of sales and applying a reduced profit margin of 20, would result in per share earnings on the present common in the neighborhood of 4.00. Applying a 25 profit margin to 90 mill ion sales could produce earnings of as much as 50. It is estimated that this earning potential could be reached by 1964 at the latest, and possibly much sooner. Thus, the company has room to virtually double earnings in a space of less than three to five years. The stock's technical pattern would seem to confirm an optimistic fundamental outlook. The stock has a potential objective of 67, with support at 40-38. With cash being reserved for t!xpansion, no dividends are paid,but it has been the company's practice to reward stockholders with a small stock dividend each year. Dow-Jones Ind. 607.62 Dow-Jones Rails 140.85 AWTamb EDMUND W. TABELL I WALSTON & CO. INC. This market letter is not, and under no circumstances IS to be construed WI, an offer to sell or a soliCitation to buy any SecUTlt..!S referred to herem, The Information contamed herem is not guaranteed us to nccuracy or completeness and the furnlllhmg thereof IS not, and under no cIrcumstances 15 to be construed as, a representa tlOn by Walston & Co, Inc All expressions of opinion are subJect to change Without notice. Walston & Co. Inc, and Officers, Directors, Stockholders and Employees thereof, purchase, sell and may have an interest In the securities mentioned herem ThiS market letter IS mtended and presented merely as n general, informal commentary on day to day market neW!! not as a complete analYSIS Addlttonal Information With respect to any securities referred to herem will be utJon – 301

Walst on &Co. FILE COff Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER May 13, 1960 The market turned strong and active on Friday, and the Industrials advanced 8.16 points to reach 616.03The rail average, which reached a new intila- day low for the move earlier in the week, also rebounded from its low. The broad advance on increased volume strengthened the breadth-of-the market pattern. The index is very dose to giving an upward reversal signal Current Dividend Current Yield 34 2.00 5.9 AMERICAN VISCOSE CORPORATION . -'The-hazards selecting sec- urities in today' s market are nowhere better demonstrated than by the recent – Long Tcrm Debt Common Stock None 4,953,915 shs. price action of American Viscose Corp. The stock was originally recommen l- ed by this letter less than a year ago in Sales-1959 239,800,000 Earned per Sh. -1959 5.18 the low 50's. At that time it was pointec out that consolidated earnings were expected to better 6.00 per share. with Market Range 1960-59 55 3/8-32 7/8 Note Sales & Earning Figures Include equity in subsidiaries half of thesp. earnings coming equit in the giant Chernstrand Corporation, th countryl s second largest producer of ny- lon and acrylic fibres. Subsequent developments altered the picturc rather radically. In effBrt to obtain the larger tire cord market, DuPont and ChemlOtrand posted successive price reductio 0 qire cord. The se were promptly met by Viscose and other rayon Ten sult, of course, was that American Viscose, itself a major rayon owni of an important – – its.elf in ng.hit fJ'9m.both side.f'i. iJ..a , price war. Consolidated earnings vs 1. 34 in the previous quarter. on e I quarter of 1959 dropped to n earnings were only 5. 18. The stock began a that the stock has situation has caused largely by '10 of 1960. Parent cotr,.panv. 1 carried it to a recent low of 32 7/2. ve 1 IS fair to ask just how badly the tire cord t l . That poor results in the final 1959 quarter were w -downs, was proved by the report for the first quarter nings were a share, while equity in the earnings of Chemstrand and another subsidiary, added bringing the consolidat- ed figure to 1.12. 'This would suggest that consolidated earnings for 1960 should con- siderably bctter 4.00 per share. A glance at the companys balance sheet and cash flow would indicate that there should be very little question regarding continued paying of the 2.00 dividend. In other words, a little more than 8 times earnings is being paid for the entire Viscose operation. One-half to two-thirds of these earnings derive from Chernstrand and Ketchikan Pulp. Both companies are in businesses where comparable operations are valued at anywhere from 15-25 times earnings by the market. In addition, a sub- stantial portion of parent company earnings are derived from cellophane of which aAmerican Viscose is the second largest producer. These earnings in the fast grow- ing packaging field alsO-appear deserving of more generouscapitalization. Practi cally no attention is being given by the market to American Viscose l 50 ownership of Avisun Corporation, one of the country1s largest polypropylene producers. Avisun is now in initial production. That the company itself considers the shares attractive at the present price was evidenced by the purchase of 165,800 shares for the treasury in the first quarter of 1960. From a technical point of view, the stock has reached its downside objective – and appears to be forming the beginnings of a base around current levels. The 2.00 dividend, providing a yield of almost 6, makes downside risk minimal and the sto('lr is re-recommended to long term investors both for new buying and for averaging high- er cost holdings. T-' nrkl l C !W… EDMuND IABLLLis to be construed UB, an offer to seU or n solICitation to VV. referred to herem The mformatJon rt0ntaincd. herem IS EJic;\l.uracy or completeness and the furnlshmg thereof 15 not,\a'fttC.ulidei! c hTnr..'Olfii'trucd as, a U0iVi,tr,.J'(l!Ie1S& IJ!.S A te'F'l!ls of opinion are subject to change without notlce wllrtat1r.!t 0', c. b'ti'nfets, –nilCt1frs, Stockholders and l'mplDYees thercif, pure ase se an 'may have an lnterest in the securities mentioned herein. Thl'' market letter IS intended and presented merely as a general. 'Pcommenbu-Y on day to dal' market news not as a complete analysis Additional mformation With respeet to any seCUrItlcs referred to herem be . furnished upon request . … . . \\ –

fiLE COPl Walston &- Co. ' Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CKICAGO OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER May 20, 1960 0espite the incredible performance of Khrushchev in Paris and the possible consequences therefrom, the events of past ten days have not greatly altered the technical pattern of the stock market. The Dow-Jones Industrial average still remains within the confines of the 637-596 range in which it has held since February. At the 596 low, the industrials had reached the first of three possible downside potentials outlined by the August-January double top at 'the 683-688 level. The first downside potential was 604. The others are 578 and 550. The first intra-day low was reached in March at 596.-'2'0—'1 was successfully testedearly inMay-at 596, 6f. The top in the rail average, formed at the 174-170 level in the first half of 1959, indicated a downside potential of 137-133. A low of 136.29 was reached earlier this month. The utility average has a somewhat different pattern. The low in this average was reached as early as September, at 84.64. This low has been successfully tested on four occassions, and in March of this year the downtrend line from the March, 1959 ,high of 95.07 was penetrated on the upside. It thus becomes a possibility that the general market has reached its low. This would become more positive if the breadth-of-the-market index improved. This index turned down in April, 1959 considerably ahead of the general market averages. It became quite bearish in December just before the Dow-Jones Industrial average reach- ed its high. Since January, the index has moved with the market whereas it had previous ly been acting worse than the market. This could indicate that an upward reversal in the breadth-of-the-market index could occur shortly. yet. While the averages advanced with increased trading activity on e fr hF'ee days of the week, there were more declining stocks than s0 k e day indicating that the rise was due to advances in special situati s(in 11!- e, defense stocks) ratherthan,a broadeninguLancL til e — day, advances exceeded declines a d co in tio is sort could result in an upward trend in the weekly breadth ke iiex. The daily index is very close to breaking a downtrend lin r t Clfi'gh. On the favorable side also, down- cases the downtr n i e d om the January highs of 688.21 and 161.00. The potenti base med on the industrials and rails since the March lows indicate an upside ob' ve of 660-680 on the industrial average and149-51 on the rails. These objec ves could be increased by a further broadening of the potential bases. Thus the technical outlook the same as prior to the events of the past ten days, but technical indications point to an eventual improvement in the breadth-of-the-market index and an upside penetration of the broad trading range in which the averages have held since February. I have mentioned the rails in several recent letters, and I continue to be impressed by the long term potentials of this group. I believe that there will be contmued discussions of merger possibilities thaf could eventually result in considerable savings for the carriers involved. That, together with increased piggy-back operations and the elimination of the unprofitable passenger operations and terminal costs, could produce some sta,rtling earnings improvements. There is also some hope that featherbedding pressures will gradually be lessened. Uncertainty regarding strike developmen1smay hold the group back temporarily, but I would suggest accumulating rail issues during periods of minor weakness. Dow-Jones Industrials 625.24 Dow-Jones Rails 143.91 EDMUND W. TABELL WALSTON & CO. INC. This market letter is not, nnd under no circumstances IS to be construed as, an offer to sell or a sohcltatlon to buy any referred to herem The mformation contained herein IS not gunranteed 8.Il to accuracy or completeness and the furnlsnmg thereof IS not, nnd under no cIrcumstances IS to be construed as, a representa- tion by Walston & Co Inc All expreSSIOns of opinIon are subJect to change wIthout nobce Walston & Co. Inc. and Offlcers. Directors, Stockholders nnd therrof, scll and may have nn lOtcrest m the- secUrlUeJ mentIOned herem ThiS marKet letter IS intended and presented merely as general, mformal commentary on da) to day market news ang not as a complete analYSIS. Additional InformatIOn With respect to any seCUrltlCB referred to herem Will be upon request T .

FILE Walston &- Co. Inc – – – – – Members New YOTk Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA OFFICES COAST TO COAST AND OVERSEAS TABEll'S MARKET lETTER May 27, 1960 The stock market still seems unable to develop any breadth or vitality. As was pointed out a week ago, despjj.e…h.e heavy volume of trading and a general advance in the averages, more stockWadvanced.tha1ldeclinedJ The same tendencies held true this week with declining stocks outnumbering advancing ones on four of the five days. This is one of the things the market technician refers to when he says breadth -of-the-market is poor. Advancing tendencies, in other words, rather than being spread throughout the list, are restricted to a few stocks. This phenomenon is nothing new. Indeed, it has been the characteristic feature of the stock market ever since April 1959. Since that time, on an average basis, more stocks have declined from week to week than have advanced. This weakness in breadth was, to a large extent, masked by a rise in the averages in the last quarter of 1959, and it was this poor breadth, as much as anything else, that made this letter mildly cautious in the second half of 1959, and quite pessimistic in December. When one looks at the technical patterns of all the stocks listed on the New York Stock Exchange, the reason for the large number of declining stocks is not at all difficult to find. As many an investor is aware, to his sorrow, a good number of stocks have been in private bear markets of their own. Some of these declines extend back only a few months; others go back as long as two years. Included in this category of de- clining stocks are practlcally all major heavy accounting for a substantial portion of the total market value of all i te These groups include, airlines, aircrafts, aluminums, autos, h mlC ,coppers, machine ries, oils, papers, railroads, rubbers, steels, an t tiles, n ically the entire roll call of American industrial enterprises. EEnce b oduced to show that this trend began even before June of Dow-Jones Industrial Average w 0 ,at its recent price the 0 aoeve its April 1956 high, yet a 10,000 investment in Oil of New Jersey, Aluminum Company of P per, would be worth less than 7500.00 today. The price II!..emlities has been equally desultory. It has, of y been impossible to make money in the stock market. If ourtheuretical in or with his 10,000 had chosen to divide his investment among such stodgy, defen lve issues as American Telephone, General Foods, Reynolds Tobacc , and Woolworth, his 10,000 would be worth 18,000 today, and had he chosen Poloroid, Texas Instrument, Brunswick, and Zenith (stocks which, it must be admitted, are easier to pick by hindsight than foresight), his 10,000 would have grown to the rather astounding sum of 124, 335. The market over the past four years then, has become a market of specialties. It seems likely to remain so until such time as the technical position of some of the major industrial groups mentioned above improves. These improvements may still take a good deal of time. A majority of stocks in the groups mentioned above have reached, or are within 5 of, their downside objectives, from a technical point-of-view. Most of them lack any sort of base for a sustained advance. A long period of backing and filling will undoubtedly be required before any sustained advance in these stocks can be predicted. Until such time, as these bases form, it appears extremely likely that the market will continu to be an extremely specialized one where selection of individual stocks will be far more important than any attempt to guess the course of the averages. Dow-Jone s Industrials 624.78 DOw-Jones Rails 141. 12 EDMUND W. TABELL WALSTON & CO. INC. Thls market letter IS not, and under no circumstances IS to be construed as, an offer to sell or a soliCitation u bu)- any '1(cUTltU!9 referred to herem The Information contamed herem 18 not gullrantceJ ru; to aecuracy or completeness and the furnlShlng' thereof IS not, and \mder no C1Tcumstanl!CS 15 to be construed as, a repre!'!enta. tlnn by 'Walston & Co. Inc All expressions of opinion arc subJect to change Without notIce Walston & Co. Inc, and Offlccrs. Directors, Stockholders and Employees thereof, purchase, sell and may have an mtcrcst In the secUrities mentioned herein This market letter IS mtended nnd presented merely as a general, Informal commentary on day to day market news and not as a completP- Addltlonnl mformatIon With respect to any SecUrIties referred to herem '\\tIl be furmshed upon request. . . . . \\ N.

&Co. tnc FIlE CJP1 Members New York Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHlCAGO OffiCES TO AND OVERSEAS TABEll'S MARKET lETTER ;.,' . ….. ;. r.rl..J.Lll ';.,,1.-)1,,-, Continued weakness prevailed in the stock mark-t most of the week and at its low on F rid a y , the Dow-Jones Industrial average; eached an intra-day bottom of 598.35. Comparable low on the ,Jow-Jones Rails was 13'8.87. This action has been entirely consistent with the thinking expressed in this letter since early January. At that time it was pointed out ihat the various potential doVl side projections of the August-January top ranged from 604 to 550. The first of these po- tential objectives was reached, and subsequently the market held for some time above its March 9th low of 596.20. It was then pointed out that one of two eventualities could take place; – Either' breadth-of-tlle-IrlarKefwoulcn,mprove, leading to the projection of a renewed uptrend, or the old low could be decisively broken with the market showing con- tinued poor vitality. If this were to be the case, the lower limit of the downside objective mentioned above, namely, the 578-550 range, would be the logical stopping place for the ,Jow. In this connection, it is interesting to note the results of a study of the individual downside objectives of each0i the thirty Dow stocks. Taking the upper limits of the downside objectives, in each case, would result in a figure of 550 in terms of the Dow- Jones Industrials. If the lower limits of the downside objectives were used, the figure would be 515. Since all stocks in the Dow could hardly be expected to reach their limits at precisely the same instant in time, it is logical to add some 5 to the figures men- tioned above. This results in a possible downside potential of something on the order of 577-540, or very close to the downside potential of the graph of the average itself. The above downside target also becomes logical when looked at from an earnings point of view. Best available estimates place the 1960 earnings for the Dow somewhere around 41.00. Over the past five years the some 13 1/2 times normal earning power (the to sell at arply when earnings were temporarily affected by a 19 , Y the steel strike). Applying a 13.5 multiple to 41. 00 earnings pri 554. — – Anothermethod-of viewing the ptctGl ould be from the point of – view of the earnings growth. For grow at a rate of 4 1/2/0, earnings would mean that 19 t r e Dow earnings have tended to YiYApplying this growth factor to 1960 at 51.00. At its early January high, the Dow situations show 11 's these earnings. Comparison to individual a high. Polaroid, for example, may well enjoy a growth rate of 3 ua 1 er the next five years. At the same time, the Dow was selling for 685, 0 r, it was available at 188, only 10.4 times projected earn- ings five years hen inn-Dixie Stores, which has enjoyed a 20 growth rate, was then available at 43, some 6.3 times estimated 1965 earnings. Thus, while the aver- age was plumetting from 685 to 600, Polaroid advanced from 188 to 240 and Vlinn- Dixie from 43 to 54 . Obviously, a large part of the overvaluation in the Dow has already been corrected. At the 550 level, it would be almost 100 corrected. At that price, the Dow would be selling for some 10.8 times anticipated earnings five years hence, a figure not out of line with recent experience and a level equal to the price/1965 earnings ratios of a good many of the popular super-growth issues. At this level, the insti- tutional patrons of the Dow blue chips would undoubtedly feel a lot more friendly toward adding to holdings The above in no way constitutes a projection that the 578-550 level will be reached, although this would become a likelihood if the old lows were decisively broken. It is still possible that the old lows will hold and that breadth-of-the-market will im- prove, signifying an ultimate advance in prices from around current levels. What does appear apparent, however, is that there is, still, some element of risk in America's leading companies which are the main components of the Dow average, and that many secondary companies still appear attractively priced relative to their long term growth potential. Many individual issues could advance even if the averages decline, and in- dividual stock selection will continue to be the key to investment success. Dow-Jones In d. 601.70 ;Qav,; Jenes Hails laQ. sa EDMUND W. TABELL WAI,8TON 8, CO TNt., IS not, Bnd under no circumstances IS to be construed as. an ffer to se1l or a sohcltatlon to buy any securIties referred to herem The contatne! herem 18 not guaranteed as to accuracy or completeness and the furDlshmg thereof IS not, and under no 1\ to be construed as, n reprcsentn tlon by Walston & Co Inc All expressIOns of opimon are subject to chllnge without notice Walston & Co. Inc, and Officers, Directors, Stockholdcrs and Employees thereof purchase' sell and may have an interest m the securities mentioned herem This market Jetter IS Intended and prescnted merely as general, mformal on day to dnv market news ang not as n complete analYSIS AdditIOnal mformatlon With respect to any securltlcs referred to herem furnished request .. . – – – —