The Washington times., 1901-10-05
THE BREAK IN -eRAPHoPHoNE.
stocks Selling at lowest Prices In
Recent Years

THE BREAK IN -GRAPHoPHoNE.
stocks Selling nt lowest Prices in
Recent Years.
No other development in the local stock
market Tor many months has caused such
widespread interest among business men
and investors generally as the sharp de-
cine that has taken place recently in the
securities Of the American Granhophone
Company. Both the preferred and the
common stocks have been declining in
price gradually for two or three years.
hut during the past few weeks there has
been break of nearly two points. which.
ON par value of so, is equal to nearly
twenty points on n stock of ,1OO per value.
Sales were made yesterday of the common
at Z, and Of the preferred at Slk. the low
est prices reached by the stocks since the
common was established on a dividend
paying basis six year ago.
No official statement has been made by
the company that would account for the
decline of the stock. The per cent divi-
ccnds on both the common and the pre-
iefred stocks have both been paid regu-
lariy, and, for the most part. and unit!
very recently. the reports of an unofficial
character regarding the business of the
concern have been rosy in the extreme
The last official statement was considered
a good one, the showing made indicating
urge surplus over the dividend pay
ments.
In the absence of disquieting news there
has been much gossip as to the reason
Tor the constant selling of the stock
that has been noticeable. 1t has been said
by brokers, acquainted with the sources
OF this selling. that it has been largely
for out-of-town parties. This very nat
urally gave rise to the theory that it was
Tor Insiders but there has been no direct
eNiuchce OF this and il is denied by
many rs result of the steady decline
some local holders of the stocks have
also sold out, either because they were
unable to hold them longer or because
OF disquiet over the weakness displayed
IL seems doubtful, however. If the local
holulngs have been decreased much If
any. as there have been investors who
believed in the securities thoroughly, de-
spite their weakness.
Inc statement is now made by a o.rec-
tor of the company that il has not earn
ca the dividend on its common stock dur
ing the past year. 1t is said by this au-
thority that something Ike go. 900 is lack
ing on this dividend, or about one-third
OF the Sy6OOO required. During the past
summer, II is said, the business of the
company has been unusually poor show
ing a falling of in the East espe cially
The hope is expressed by this director
that the autumn and winter business
VIII improve. As yet, it is said, there has
been no discussion by the directors of the
question Of cutting the dividend rate on
the stocks. The company is understood
20 nave d lefse surplus, and it would be
possible undoubtedly to continue the divi-
dends at their present rate for some time
10 come, II that course were thought best
provision of the bylaws of the COM
pany is that the preferred stock shall be
4 II iEis .Fth nc ffTRgr nc
that amount is earned on it. and that
when, In the opini-n of the directors the
earnings of the company are sufficient,
dividends on the common may also be
paid 1t is also provided that the two Sc
curiues shall share alike in any dividend
disbursements over ( per cent and that
no dividend over this rate shall he paid on
the preferred unless the same amol mt is
paid on the common at the same time.
There has been some talk recently of the
possibility that the dividend on the com
mon stock might be cut and the dividend
on the preferred remain at its present
rate. This, it will be, seen, would not be
possible. The dividend on the preferred
might be cut to per cent, however and
the common cut as much as the directors
should see fit or discontinued altogether.
The securities of the GraphophCne
Company are largely held in this
city. 1t is estimated 99by those IA
miliar with the affairs of the com
pany that from so to GG per cent of
both issues is owned by Washington in
vestors. There is Of the common stock
81. 10000, and of the preferred $SDDOD,
making a total of s., GJ0.00Q II is believed
that at least 81 100000 of this is held local
Iy. The GraphophOIa Company is to
certain extent local concern, its found
crs and others prominent in its recent ar
fairs having been Washington people For
this reason it's securities have been IA
vorite investment here since the founda-
ton of the company, nearly hfteen years
The concern at first issued only one
stock This issue advanced in price TO
around 20. although no dividend was paid
on it. The preferred issue was hoated
when the Edison Company was taken IN
A dividend was paid on this stock from
the beginning, and 1t was said that the
company was prosperous from the month
the consolidation was made. 1t earnings
did not begin to increase rapidly, how
ever. until several years after. The re-
ports furnished by the company nave not
been very complete, and stockholders have
fran,entiy comDlained over their lack of
details as to the way in which earnings
were made and their exact amount from
year to year. 1t was SAID repeatedly by
officers of the company, however, thdt IT'S
profits were very large, and good eVl-
dence of this seemed to be the institution
of a dividend of per cent on the common
stock. as stated about six years ago.
As a result of the high dividend rate
paid and of the glowing reports made by
friends OF the company ITS securlueS au-
vanced rapidly at that tim time bnYa ana Soia Sor
Sipca the wear 1899 they have been de-
cIining steadily in price. In the latter
mart Of that year they sold around II, ana
last year went down to par. During the
present year the decline has been more
rapid.
There has been some uncasinass during
the past two or three days over the con-
dition of the GraphcphOne stocks held by
the banks locally as security for loans.
II is known that the banks have some of
the stocks as collateral but the state
banker
last night that the amount is probably
not great This gentleman expressed the
opinion that there is not much likelihood
Of any considerable blocks being thrown
on the market from this source.
aDMv OPnFRS