Studies in securities

Bibliographic data

Monograph

Identifikator:: 1757542078

URN:: urn:nbn:de:zbw-retromon-134903

Document type:: Monograph

Title:: Studies in securities

Edition:: Revised

Place of publication:: New York

Publisher:: Jas. J. Oliphant & Co.

Year of publication:: 1927

Scope:: 81 S.

Digitisation:: 2021

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: American Can Co.

Collection:: Economics Books

JAS. H. OLIPHANT & CO. 1926) before declaring any dividend on the common stock. Except for the 12% in 1916 and 21% in 1917 (war years) the company never, up to 1922, earned over 8% in any year on its common but its record had been fairly stable, In 1922 the conservative policy of husbanding profits began to bear fruit in real earning power. After per share surpluses on the old $100 par stock of less than $3 in 1921 and under $5 in 1920, the earnings were as follows: O08. ic cnn 92275 19235. enn $10.05 1924. ......... 20.50 92D ena 13:50 In this period, the $9,000,000 debenture issue was paid off and working capital (excess of current assets over current liabilities) increased from under $30,000,000 to over $40,000,000, notwith- standing common dividends paid aggregating 2214 9%. This was the new era of American Can Co. In 1926 with unsatisfactory price condition in the trade, the net earnings for the common declined to $10,850,000 from $13,504,000 in 1925 which meant $26.35 a share on old stock against $32.75 the year before. In 1926 a 509% stock dividend and reduction in par value from $100 to $25 effected a six for one split-up of the com- mon stock so that 1926 net equaled $4.40 a share on the new stock compared with equivalent of $5.45 in 1925. Capitalization of American Can Co. consists of $41,233,300 7% preferred stock and 2,473,998 shares of $25 par common stock paying $2 dividend. As of December 31 last, current assets were $52,588,000 (including $15,863,000 cash and Government securi- ties) and current liabilities were $11,612,000, a strong treasury position. Book value of the common shares was $40. As to the integrity of this book value, we find the plant aceount carried at $110,150,000, an increase of $14,277,000 from the figure as of December 31, 1921, whereas in the five intervening years expenditures for new construction aggregated $26,139,000. Furthermore this book value of $40 a share is figured after de- ducting $10,324,000 reserves, which includes $4,060,000 inventory reserve and $4,096,000 insurance reserve. Dominating its industry as a producer of containers for food and other products (three or four times larger than its nearest com- petitor), American Can Co. has plants in thirty-eight cities of the United States as well as others in Canada and Hawaii, Its business is normally of a stable character. In 1925 and 1926 the pack of canned foods was large, and owing to this overproduction outlook is for a reduced pack in 1927. A large proportion of the 41 Tam

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