New-York tribune., 1920-10-23
Bonds Yield More Than Preferred

Sses r. ssF e. @
~ any greater security or advantage over
sn sne per cent preferred stocks Of the
preferred? How does 1t happen that the
bonds Of this company advertised in The
Tribune have greater yield than the new
per cent preferred stock, Do you rai-
,he preferred stocks as fair investments?
Mrs. E. Fl. S.
Answer-The per cent preferred
stock of the Consumers Power Company
OF Michigan was offered to employees
and customers at 95, payment to be
made, if desired, on the partial payment
plan. Prior to this offering a small issue
OF per cent general mortgage bonds due
1883 had been syndicated, and it is this
issue which was recently advertised.
hese bonds are, to be sure, a better
investment than the preferred stocks,
but they were not offered on the par
tai payment plan. No doubt the offer
ing, OF the bonds placed somewhat of
a camper on the success of the pre-
1erred stock offering. Both classes of
preferred stocks are equal, the 6 per
cent issue being quoted recently 70 to
49, The company shows Improvement
IN earnings, both gross and net. 1t
pays dividends regularly on its pre-
ferred issues and per cent on tho
common stock. The trouble with
many public utility corporations to-da5
Is not SO much a question of earnings
as 1t is question of raising capita
tor expansion. This company has great
demands made upon it for additional
power. 1t needs funds in order to fur
nish it, 1t is not case of prospective
business but an actual demand, which X
/
lsfy; We believe that the we'll man
aged pubic utility properties have long
slnce passed through their worst pc
riod' so tar as earnings are concerned
mere are already large demands upon
capital from practically every source
and, until conditions in the money mar.
ket are better, we shall probably find
that many well managed public utility
corporations viii have to wait We re.
gard the preferred stocks of the Con.
sumers Power Company of MICHIGAN as
entitled to good rating. If YOU can
however, stlll purchase the bonds tc
Neid greater return, we advise yor
DONG so IN preference to PURCHASING
the preferred stocks.
Wants Stocks to Rise in Short Time
Nuestion--I own fifty shares Of Webe,
~ nrHor9ner common stock. bought a
- Hlly snares OF Loose -Wiles Biscuit com
mon, bought a. TO- Would you kindly nd
wise me whether l should sell same and in
vest IN some other stock whore I woul,
nave better prospects for a rise in
shorter time? How secure are the abov,
mentioned stocks? What ls the value o
W eber Heilbroner stock? l don't sc
IL listed on the curb.-H. s.
Answer-Weber & Heilbroner has no
issued statement of earnings. Al
initial dividend Of so cents share wa
paid last April on the common stock
We have no record of recent sale
Loose Wiles Biscuit has shown yer,
good earning power of late. In 1911,
the equivalent of about 20 per cent wa
earned on the common stock, and Will
no common dividends are paid, OWN,
to the fact that there is an accumula
tlon of dividends on the second pre-
feired stock, the company shows con
siderable progress. The stock is spec
ulatlve, as is Weber & Heilbroner |
you wish to place yourself in SCUM
investment position you should pur
chase only those issues which are no
so sensitive to earnings Good bond
and seasoned preferred stocks are j,
this class. We cannot suggest stock
for speculation.