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 
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