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 Tobacco Co.

Collection:: Economics Books

STUDIES IN SECURITIES ER taxes, or $17,093,000 average annually comparative with the rec- ord for a single year of $22 549,000 in 1926. After deduction of bond interest and preferred dividends, $199,194,000 total was left for the common stock and $137,600,000 or 69% was dis- tributed, evidencing the liberality possible in an established busi- ness in this field. As for stability of income, the 1921 year, so disastrous elsewhere in industry, was the best American Tobacco had up to then enjoyed. Present capitalization consists of $1,150,000 funded debt, $52,- 700,000 6% cumulative non-redeemable preferred stock, and $40,- 242,400 common and $57,399,100 common class B non-voting stock of $50 par or 1,952,830 shares in equity. Surplus beginning 1927 stood at $34,948,000, which was not far below the $40,095,000 of 1911 notwithstanding payment in 1920 of $38,375,000 or 75% stock dividend, and as equal to 36% of the common stock it would form the basis for a second but more moderate stock distribution should the management see fit. Figured on shares of $50 par value, into which the $100 shares were divided in 1924, the earnings of recent year: “low: J92- ct i EE 1922 1922 1921. Only a single item of total income is stated by the company and amounts taken out for advertising expense and for property up- keep may only be conjectured to be large. Present value placed apon good-will, brands, ete., is $54,099,000, there having been no increase since 1913 despite huge outlays representing perhaps in part a capital as well as a current expense. Plant is on the books at $9,607,000 against $9,203,000 five years earlier. Furthermore, income includes dividends received from subsidiaries which might pay more, such as 8% from $10,351,000 American Cigar Co. common stock, 529% owned, having 119% or 129 earnings. Dividend rate on American Tobacco common, which had been 12% since the 1920 stock distribution, and at the nearly equivalent rate of 20% on the smaller stock issue since 1912, was increased to 14% or $7 with the December, 1924, quarterly payment, and again to $8 just a year later, when $1 cash extra was simul- taneously paid. A company practically free from funded debt, with current lia- bilities $2,199,000 against $97,685,000 current assets including $16,450,000 cash, and a fifteen-year record of steady growing earn- ings and dividend liberality, American Tobacco has the qualifi- cations necessary to place its stock among investments. [231

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