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:: International Telephone & Telegraph Corporation

Collection:: Economics Books

JAS. H. OLIPHANT & CO. despite more than doubling the shares during the last twenty years by stock distributions. Cost of $28,000,000 cash for the Western Electric business, conducted now under name of Inter- national Standard Electric, compared with $3,012,000 average four-year earnings obtained from $26,000,000 to $40,000,000 vol- ume of sales. Accordingly these acquisitions both appear good value. To the operated telephone systems with which the com- pany began in 1920, of Cuba and Porto Rico, now each 98% owned, International Telephone added at a moderate outlay 80% ownership of the lines in Spain in 1924 and 92% of those in Mexico in 1925. Beginning 1927 the number of ’phones served was 63,834 in Cuba, 12,533 in Porto Rico, 20,485 in Mexico, and 114,360 in Spain, and against over 1,500,000 in New York City alone the figures emphasize possibilities for expansion. During 1927 control of the telephones in Chile and Montevideo, Uruguay, was acquired. Ability of International Telephone management to improve earn- ings per share regardless of additional stock issuance stands out strongly. Record has been as follows: on average amounts of stock outstanding, $16 in 1926 and $13 in 1925, on shares at close of the years, $11.20 in 1924, $8.40 in 1923, $7.30 in 1922, and $6.50 in 1921. Since organization in 1920 a $6 dividend rate has been regularly paid and four subseription rights in three years have given additional cash value. Capitalization, $35,000,000 415% bonds of the parent company, $8,889,000 bonds and $8,165,000 preferred stock of subsidiaries, 48,799,000 subsidiary equities, and the $130,000,000 International Telephone stock, surely is on sound lines, and under highest bank- ing sponsorship this company looks forward confidently. Priced to return less than 5%, the stock displays a warrantable expecta- tion of increased dividends. Louisville & Nashville R. R. Bought ‘like a box of candy’ from a speculator (John W. Gates) in 1902 for $50,000,000, the 51% of Louisville & Nashville R. R. stock then so casually acquired for Atlantic Coast Line R. R. has returned over $56,000,000 in cash dividends in the twenty-four years since (excluding dividends on 61,200 shares subscribed at par in 1912). Indirect return from traffic interchange has doubtless been much greater. Benefit has been mutual, and Louisville & Nashville, originally unrelated geographically to Atlantic Coast Line, owes much of its prosperity to development as an integral part of the Coast Line system. 143]

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