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:: Southern Pacific Co.

Collection:: Economics Books

JAS. H. OLIPHANT & CO. proper. Latter’s 13,400 miles, recently double-tracked in effect 70% of the way from San Francisco to Ogden and 90% from the California border to El Paso, represent with 23 New York-New Orleans steamships a service of unequalled extent and the eight southwestern states traversed claim a growth only beginning. Proportions in capital structure of $599,268,000 funded debt, $372,406,000 stock and $433,994,000 surplus are sound. Nearly 60,000 stockholders consider Southern Pacific a good investment and its prospects have not been much exploited marketwise. Southern Ry. Price of Southern Ry. common stock crossed 43 for the first time in 1924 just ahead of the first dividend declaration. Then early in 1926 the rate of payment was raised from 5% to 7% and later new stock was successfully offered at 100 for subscription. In so brief a time a place in the front rank was taken. Over and above $21,000,000 common dividends paid, the company earned $33,945,000 surplus in the past three years, and this was more than a third of the accumulated $91,580,000 shown for the preceding thirty years. To contrast with $11,400,000 preferred and common dividends and record $23,597,000 net income in 1926, the range of earnings during fifteen years to 1916 excepting for the meagre 1908 and 1915 fiscal periods was from $2,290,000 to $7,078,- 000 maximum. Even on the $60,000,000 preferred stock, 5% non-cumulative, dividends have averaged omly 2.95% annually to date, and so recently as from June, 1921 to November, 1922 were suspended entirely. Altogether, however, from July 1, 1894 to December 31, 1926, before allowing on the one hand $16,000,000 discount on securities sold and on the other $30,000,000 capital charges in early years included in operating expenses, Southern Ry. has shown $125,525,000 earnings kept for surplus, after pay- ing $75,454,000 dividends, and the amount exceeds the par of $120,000,000 common stock outstanding until 1927 unchanged. With a Government valuation using 1914 costs, and with 15% of the equity composed of subsidiary company stocks carried at 95% of par and 42% of book value, Southern Ry. common stock is worth about $190 a share. Business done, as expressed in tons of freight moved one mile for each mile of road, was 271,029 in 1896, 527,029 in 1906, a 95% increase, 799,398 in 1916, a 529 increase, and 1,327,910 in 1926, a 66% increase. Presumably when the growth reached a certain [687

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