STUDIES IN SECURITIES

chinery to the farms for cost reduction, and with the electrification
 of railroads, supplemented by radio, electrical refrigeration,
and talking movies, in which General Electric is already interested.
 Extensive projects of railroad electrification are under
consideration, with only 29% of Class 1 mileage of American
roads yet electrified. Power generation, we are told, will more
than double in the next decade. Only 214% of farms enjoy electric
 power.
Past record, present condition, and future prospect combine to
place General Electric stock in a secure position among industrial
 stock issues of real investment character.

General Motors Corporation

The present General Motors Corp. may be said to date from 1922
when after the losses of the deflation period the management
was changed and new clearly defined policies inaugurated. Fullest
advantage was taken of the following five years of general prosperity
 and the accomplishments provided the commercial sensation
of the country, viz:
1926 1921
Net sales...........$1,058,153,000 $304,487,000
Net earnings ....... 186,231,000 def. 38,681,000
Working capital.... 192,006,000 96,542,000
Cars sold . 1,235,000 215,000

Always a leader in this 26-year-old industry, General Motors
is the largest automobile manufacturer in the world (now making
one car in every three produced in the United States and Canada)
and, even more, paid out in dividends on its common stock in 1926
the largest total in the history of industrial enterprise.
Of the surplus available for the common stock the following percentages
 were paid out in common dividends: in 1926, 62%, in
1925, 63%, in 1924, 66%, in 1923, 45%, and in 1922, 23%, notwithstanding
 which there was reinvested $179.744.000 in the property
in these years from surplus.
We find at the end of 1926 the plant account carried net (after
depreciation) at $310,482,000 or $99,416,000 more than at the end
of 1921, whereas the plants in 1926 turned out almost six times as
many cars as in 1921. The great Fisher Body plants have been
acquired, the Pontiac and La Salle cars added to the line, and
Frigidaire (the electrical refrigerator) has been developed (1926
increase in investment therein amounting to $19,000,000), to mention
 only the outstanding developments. The conservatism of the
plant account is obvious. This point must be considered in connection
 with the $55 tangible asset value of the common stock.
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