The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1916-02-04
Business and Finances

New York, Jan. 20, 1916.

New ork, Jan. y, lSlo.
Amy expectation that the enormous
expansion of the steel trade and kim
dred industries during the past year
would be reflected in extraordinarily
large dividends to the stockholders OF
the steel companies was at least tenn
porarily sidetracked when the Bethle-
hem Steel Company declared it's 80
per cent dividend on the comm on
stock. and the United States Steel
corporation declared ~ per cent
quarterly disbursement on its common
stock. Wall Street was disappointed,
for these disbursements represented
only small proportion of the net
earnings of the giant corporations.
But Wall Street has a way of forget
ting that the future development and
stability of dividend-paying corpora
ton is as important a factor as pres
ent-day disbursements. Even with the
current quotations of these stocks, the
6 per cent basis, leaving out of all
consideration the possibilities for flu
ture appreciation based on the expan-
sion of the steel trade.
The tremendous advance in the &C
tivity and the earnings of the United
States Steel Corporation during the
past year has been perhaps the most
remarkable feature of the industrial
revival which is now sweeping over
this country. A little over one year
ago. on account of the falling off in
the earnings of the corporation, the
dividend on the common stock was
first reduced from S to per cent, and
then passed altogether. After the pay
ment of the preferred dividends for
the last quarter of 1914 there was
deficit of $1.847, 1897 from the years
operations, compared with a surplus
of $50, 785, 0O6 in 1913. Earnings inn
proved somewhat in the first quarter
of 1915, when they advanced to $l2,-
457 800, but after the payment of the
preferred dividends there was de-
ficit of $5,389,86l. 1t was not until
the second quarter of last year that
the first actual signs of the phenom-
email expansion in the steel industry
appeared. Net earnings for the June
quarter jumped to $27.o50,OOO. suffi-
Gent to pay the preferred dividends,
make up the deficit for the preceding
dnarter and leave a surplus of ST.
87. The third quarter earnings
went to $38.7l0,644, within 81 1000, 900
Of the record, which left available $l8,-
O37,24l for surplus. This remarkable
statement caused the first discussion
of possible resumption of the COM
mon stock dividend, which reports
have persisted ever since. In fact.
there was some talk before the Octo-
Der meetings that payments might be
resumed, but there was little disap-
pointment when such action was not
taken. Attention was called to the
great prosperity of the Steel Corpora
ton two weeks ago when the directors
-, srr of IN
in the wages of common laborers to
take effect February LIST.
The earnings for the fourth quarter,
which were not published until this
week, and which may be considered
as important as the dividend resump-
ton as a market factor. reached the
enormous total Of Ssh 1878. or near
ly six million dollars more than the
previous high record. which was made
in the second quarter of 1907. The
corporation. has $l05, 100000 in cash in
the banks. its plants are working full
time on new orders booked at very
profitable. prices, and all old orders
taken at bargain prices early in 1914
are filled and out of the way. This
makes the outlook for large earnings
during 1916 for both the Bethlehem
Steel Corporation and the United
States Steel Corporation very bright
aInvestors in recent months have
been buying thcir4 securities with an
eye to dividends. On the whole. the
results have been very satisf factory
and the country's standard industrial
and railroad companies have given
Very good accounts of themselves in
cerned. The February disbursements
for interest and dividends will exceed
$13O,OOO.OO0. divided equally as &c
their source of payment. The divi
dends on industrial stocks will tota
$33.76283 on steam railways $27.
SS7,32l, and on street railways "a, ia.
coo. Investors continue to take f;
hopeful view of the dividend outlool
| looking for initial disbursements b,
many companies which have enjoyed
a. remarkable revival in activity dur
ing the past year. In many instances
surplus earnings had to be devoted
either to the rehabilitation of OLE
plants or to the building up of new
\ ones, but this makes them all tn,
more secure for the future. and thi
security should be reflected in stock
i holders profits. One important com
pnny, in announcing an extra dividen.
EAT statement: "The directors expee
4 hereafter to declare quarterly divi
bends on conservative basis, and /,
consider at the end Of each fiscal yea
II additional dividends Gf any,, tn
earnings of the fiscal year and tn
H financial condition and the prospect
H Of the company warrant" Such pol
Il icy will doubtless meet with the ap
II prevail Of the stockholders.
II Changing Character of Worlds
II i Markets.