Tabell’s Market Letter – December 15, 1967

Walston &CO. Inc. ;…..;;……;….;.. MUNICIPAL BONDS UNDERWRITERS MUTUAL FUNDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER December 15, 1967 .. actien has failed to. impese any great degree ef clarity en the steck market sltuatlOn. Smce the Dew reached a high at 901. 76 a week age, at which time eur shert- ra.nge escillater teuched ever-beught territery, we have seen a 3-day decline fellewed by a mild advance, and the escillater has meved back into a neutral area. So far the cerrectien mild with breadth reasenably geed and a number ef issues meving to. new highs. Ability to. cemplete the cerrective phase while helding at er areund the 860 suppert level en the Dew weuld have to. be censtrued as a bullish signal. Meanwhile, the invester can best himself market uncertainties by helding these stecks with a high degree ef q.ualty and defenslve value tegether with an abeve average appreciatien petential. One sucn issue is reviewed b-elew. – – — .. – — Current .Price Current Dividend FEDERATED DEPARTMENT STORES 75 -1/ 4 i If the sheppers crewding into. the natien' s 1. 70 department steres this Christmas seasen are any Current Yield 2.3 indicatien, retail sales this year sheuld rise to. a newall-time peak. Despite the much-talked-ef Leng-Term Debt 70,672,292 scarcity ef meney, there seems to. be mere than Cemmen Steck 20,810,735 shs. eneugh changing hands ever the ceunters. True, much ef this Christmastime's gift buying is Sales-1968-E Sales-1967 1. 5 billien 1. 4 billien being cenducted via the charge acceunt but, by and large, Jehn Q. Public appears willing to. spend his higher inceme, and much ef that Earn. Per Sh. 1968-E Earn. Per Sh. 1967 spending is departmeJlt, ste trend to. it wa EtSlft geeds and ether B efiting from this em big-ticket items, Mkt. Range -1967-66 75-7/8 – 54-1/8 the leading stere chains are antici- Federated Department Sto.res is ana tra . e inal quarter. We feel that ed yticipating in this eriented industry. Federated is the stere chain, including within its ergani- zatien such City, Bulleck's in 0. a m & Straus and Bleemingdale's in New Yerk i e in Besten, and Feley's in Ho.usten. All ef the abeve-nal!led units i egraphical areas that have demenstrated an abeve- average rate ef pers I nc grewth in recent years. Mest ef them also. have benefited frem the trend ever the decade to. branch eut into. the suburbs where the rate ef return en invested capital ha een mere faverable than that ef mest dewntewn lecatiens. The mest eutstanding exceptien to. this is Abraham & Straus's main Breeklyn stere, censidered to. be the mest prefitable large department stere in the natien. Federated has grewn largely threugh acquisitiens. With existing fleer space up to. a faverable level, the number ef new-stere epenings is expected to. decline next year, but the new year is likely to. bring with it an initial feray into. disceunting. This meve co uld impreve prefits substantially in the years immediately ahead. So. far this year, Federated has been able to. buck the dewntrend in earnings experi- enced by the majerity ef department stere chains with its ewn earnil1gs threugh the first nine menths ahead ef a year age. Fer the full fiscal year ending January 31, 1968, earnings are expected to. shew a geed imprevement ever the 3.54 a share ef fiscal-1967, perhaps rising to. 3. 65 a share. With new stere epenings decreasing in number, there is a pesSi- bility that the increased earnings co.uld bring abeut a rise in the current 1. 70 annual dividend payeut rate. Technically, Federated shares have built a base ef censiderable suppert in the mid- sixties area, suggesting an initial price ebjective ef 90, fellewed by a higher ebjective at 124. With these high quality shares effering this substantial appreciatien petential, they were added to. the Quality & Leng Term Grewth .ectien ef eur Recemmended List at 69-7/8 en Nevember 17, 1967. They again are recemmended fer purchase at current market levels. Dew-Jenes Ind. Dew-Jenes Rails 880.61 234.35 HARRY W. LAUBSCHER fer ANTHONY W. TABELL WALSTON & CO., INC. AWTHWLsb Thill market letter Is publlBhed for YOUr convenience and information Rnd is not an offer to eell efomrpmloaytieoens mWaMy hoabvteainaend InfrtoemresteoIunrcoeer. pwureehbaeJsielVaendtosebllethrfe,hsaebcJeu,ritbieust rweeferdroedntoot hgeuraerina.ntee Jts ln8Ol.i 'tat' &t- oCbOU,Y y nco an . o…….era. recTtohres ion-r