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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Document type:: Monograph

Structure type:: Chapter

Title:: American Steel Foundries

Collection:: Economics Books

JAS. H. OLIPHANT & CO. i American Steel Foundries In 1926, which was with two exceptions probably the worst in 25 years in the railroad rolling equipment business, American Steel Foundries earned its $3 dividend with $1.49 a share to spare. This is the more striking when one recalls the checkered career of this company in pre-war days. Two factors have brought about the change: (1) war profits were husbanded and in the eighteen years since the capital readjust- ment in 1908 out of $43,778,000 aggregate earnings dividends were paid of $21,320,000, leaving $22,458,000 plowed back into the property (largely into working capital) or $25 a share on present common stock; and (2) in 1919 the Griffin Wheel Co. was acquired which with the renewal character of its business has stabilized American Steel Foundries’ earnings. Thus the company, according to December 31, 1926 balance sheet, had current liabilities of $3,278,000 and current assets of $21,- 177,000 of which cash, Government and other securities totaled $12,143,000. Working capital of $17,898,000 would provide 110 (redemption price) for $8,713,000 7% preferred stock and leave $9.20 a share for 902,745 shares of no par value common stock (company has no debt and only $305,000 subsidiary stock obliga- tion). In addition, net capital assets provide $38 a share, includ- ing probably $4 or $5 for good will (figure not available), so that book value of common totals $47 a share. American Steel Foundries is the largest producer of steel castings, sold for new construction, mostly of railroad equipment but also of steamships and machinery. In 1919 through issue of $8,481,000 preferred stock, the Griffin Wheel Co. was acquired, which is the largest maker of iron car wheels, 85% of which year in and year out go for necessary replacements. Griffin Wheel Co.’s $4,300,000 6% preferred was retired in 1925 (American Steel Foundries’ old debt of $6,836,000 wiped out by 1923) leaving capitalization as above described. Figured on present number of shares as increased by stock divi- dends of 18% each in 1920 and 1922 and 25% in 1925, earnings have been as follows: 1928... ....... 54.40 1025. cue... 4.50 1924... 4.60 1923. . 7.60 1922. .0vees..32.50 1921.....defic"" 28 1920. . A 1919. The current $3 annual dividend has been maintained since 1920 C181

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