JAS. H. OLIPHANT & CO.

tillable; in every year since 1919 contract cancellations have returned
 more acreage to the company than sold, but with the
storm. over settlers are reappearing in the country.

Unification with Great Northern Ry., now proposed, is the reasonable
 outcome of joint ownership of Burlington which neither
would give up. Savings calculated to result from common operation
 of exceeding 27,000 miles of road are $10,000,000 or $2 on
Northern Pacific shares. In addition an equity of $1 to $1.50 per
share in Burlington earnings micht be taken.

All ready for a renewal of empire-building the Northern Pacific
Ry. since 1917 has equipped the 3,000-mile main line from Twin
Cities to Pacific Coast with automatic signals for efficient operation,
 adopted 100-pound rail as standard, and added 7% to locomotive
 power. The 1926 earnings reaffirm the investment value
of the stock, and the eventual correction of rate inadequacies
together with a gradual recovery in farming, mining, and lumber
 promise eventually the 7% dividend and a price of par for
the stock again.
Pennsylvania R. R.

Prestige of Pennsylvania R. R. was bred in the payment of dividends
 every year since 1847 and found refreshment last November
when the rate was raised from $3 to $3.50 or to 7% on the $50 par
shares. Just as a reduction to a $2 rate lasting from May, 1921 to
November, 1922 displayed the adverse conditions then encountered,
So the recent increase means the way is clear again, for excepting
Six quarters at 7% between 1900 and 1921 $3 or 6% was the regular
 distribution.

Steadily if slowly the proportion of revenues taken by operating
expenses has been brought under control and accordingly the net
for dividends has been expanded, viz. :
Share Earnings Operating Ratio
26.20 71.5%
£25 78.4
~ 80 80.2
50 81.9
25 82.6
30 86.1

Reducing the expense ratio two points with revenues exceeding
$700,000,000 a year adds $1.40 to share earnings.

Equity in Pennsylvania R. R. is different than it was ten or more
years ago. The same amount of $499,266,000 stock had the residue
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