New-York tribune., 1922-05-14
Graphophonc Stocks Prospects

SUcCuluLlOl1.
Graphophonc Stocks Prospects
0ucsti"n-Wil YOU please let mo have
"i Columbia Ora aphophonc common stock
would be good Investment? / have
,e"fn"d ihat tho company intcnds shortly
I" mnnufncture radio roceiving sots on y
lhlBe scale, and for trat reason the stnc.
would be an excellent invcstment.--J u G.
Answcr-Columbia Graphophone com
mon stock cannot be considered suit
able for an invcs tmcnt, as we use the
term. Many companies have under
taken the manufacture Of radio re-
cclrlng sets in response to increased
demands for wireless commodities, but
1t is forcgonc conclusion that not
all Will be profitable. The weaker ones
undoubtedly will fall BY the wuyside
whcn the reaction of overproduction
sets IN. Whether the Columbia Graph
ophone Company will be successful in
this contemplated departure from manu-.
featuring talking machines remains to
be sccen. 1t has passed through
particularly trying period and only re-
Gently was successful in having dis
missed in the United States District
Court of Delaware petition brought
by stockholders to appoint q receiver
for the company The company suf-
fered deficit OF SIS ,S81 .C6S after dvi-
dends in 1921, as compared with q
surplus of 81 ,497 ,923 in 1920, largely as
result of an inventory adjustment
of more than $ll 100000. The operat-
ing loss for the year was in excess of
5000, 900. IT Will be seen, therefore,
tnat the company has many handicaps
to overcome in obiltating itself. and
while this process is going on little or
,1n IA l. I
OF the common stock. OF course, the
recovery may be complete in time and
the point may be reached eventually
when it will be possible to resume
dividends on the common stock, but
that is q speculative question on
which we cannot attempt to express
an opinion. In other words, the com
mon stock is suitable only for those
in position TO assume the spccula-
tive risks involved.
For Man of Sixty
Question: would greatly appreciate
expression OF your opinion on the follow
ing list OF bonds held by me as an Invest
ment. on the income from which ! am
largely depending. / am over sixty years
Of age With i've in the family. The list
$500 United States first Liberty. regis
tered $4,000 United States fourth Liberty,
registered: 5000 Government of French
5.
81 1856 1000 United states of Brazil SO.
1871: 5000 Republic of Chile Ss. 1871;
5000 Ottawa Light Heat and power So.
1870. g., 900 state Of Sac Pau,o S. 1896:
$1,000 United Railway Of Havana 8s, 1886.
$1,000 Armour Company 7s, 1890; s., 600
conegnaush Power Company Ss 1850;
$1,000 Standard Tank Car Company : ias,
1891 $1,000 Pennsylvania Power and Light
Company 1as. l94o; $4,000 f: /. du Pont
de Nemours 7i4s. 1881; $1,000 Duquesne
l.ignt COnOauV SIS l94a. s. 900 Puget
Sound Power and Light 7las, 1871; S2,Oos
pcpew and Lancaster Light and Power 5s.
1854 So, ,0o0 Detroit United Railways SIS,
1871; $4,000 Southern Porto Rico Sugar -,
1891: $1,000 Kingdom Of Dennari< 6s
lai2; $1,000 Dutch East indies 6s. l9i7;
$1,000 Wilson & Co. 7l4s. 1921: $1,000 Wis
consin Minnesota Light and Power COM
pany general Is l947; $4,000 Missouri Pa
cihc general As. 1875; $4,000 Inter borough
Rapid Transit 5s, 1866 1900 ST. Louis &
san Francisco, Inc. Gs, 1860; $4,000 Sin
clair Consolitiated ON Corporation is, 1871,
1877 $4,000 Missouri Kansas Il Texas ad-
iustlnent Js, 1862. What changes, il any
WOULD YOU suggest either to better the In
come or TO increase the safety of the in
Vestment! At the present time con-
sdering tho investment OF $4,000 in a
nanufaotuTins business which would
amount. Which of the bonds would you
recomm!end selling, with the idea so far
as possible, of conserving the income and
improving the investment?-F. NJ. L.
Answer You have an investment
which yields Approximately per cent
at current market prices in a market
which has been adjusted to give re-
turn Of less than 5 per cent on gilt
edge bonds. Yet apart from the Lib
erty bonds, not q dollar Of your sos, 900
original investment is secured by gilt
edge issues. Another observation
which we feel called on to make is
that only $3.50 Of your original in
vcstmcnt was in American railroads,
aside from the ten income and adjust
ment bonds on which interest is paid
only if eUnod 1t is plain enough that
in making these purchases your first
consideration was copous income,
making security Of principal minor
factor. This is & badly balanced in
vestm ent in at least two particulars
diversiicaton as to Grade of
securities and diversifcation as to the
nature of borrowers. The $4,000 of !
Liberty bonds in an investment of this
size furnishes only a weak backbone
at best. We do not think that we are
inconsistent in suggesting as a means
OF raising the necessary $4,000 the
disposal of the Missouri, Kansas &
Texas 5s and the st. Louis-San Fran !
cisco income 6s. BY selling these. the |
Brazil SIS and the Chile SIS Won would |
realize Il total of SlO,560 at recent
market prices