Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-27

increase of the value behind his stock.
Second, the telephone company usually
finances it's expansion largely through
the sale of common stock rather than
by adding to its bonded Indebtedness.
Since 1922, at tWo-year intervals,
common stockholders have been allowed
to subscribe to one share of stock at
500 for each five held in 1922 and 1924
and one for each six held in 1926 and
1928, which process gives those who al
ready hold telephone stock a consider
able advantage over market prices. How
valuable an advantage 1t will be in the
future. however, is difficult to calculate,
since the value would be affected by the
selling price OF the stock at various
times.
In the last six years, however, these
rights have added over $3.50 share to
The SO dividend rate, SO that the pern1a-
nent stakeholder has virtually received
a yearly return of $1250 on his stock
At present prices the yield on the stock
would amount to 81 per cent a share If
rights are issued in the future which
prove as valuable as the former ones
have. In this connection it is signifi-
cant that the company is now asking its
common stockholders to approve an in
crease. in authorized stock from 15,-
100000 to 100000 shares, which in
crease In capital will undoubtedly be
used for further expansion.
The company still has on hand
large amount of cash received through
the 1928 subscriptions, so that there is
little likelihood that rights will be given
before June, 1880. But although the
thing from rights until that time, he
can be confident that the regular SO
dividend will be earned by an ample
margin. Earnings has increased stead
lily over long period of years, touching
$l211 a share in 1928 after averaging
S1l.63 for the past seven years. These
earnings include only dividends paid by
associated companies to A. T. 81 T. and
do not include its share in undistributed
earnings.
A. T. & r. is unquestionably Amer
ica'S leading investment stock, with
1895 stockholders holding an average
OF % shares apiece. While it is affected
somewhat by general stock conditions,
the stock is used as the foundation for
many common stock investment lists.
International Telephone g. Telegraph.
International Telephone &c Telegraph
Co. has expanded in the foreign teie-
phone field during the last eight years
much as A. T. & T. has done in the
United States.
Since. its organization few years
ago the company has purchased stock
in the telephone companies operating
in Spain, Cuba. Porto Rico and other
West India Islands, Mexico and i'm
portant countries of Central and South
America. In addition to these acquisi-
tions, the I. T. & It. has subsidiary
which owns foreign rights for Bell pat
ents and has factories in many parts
of the world which manufacture tele-
phone equipment for her AFFILIATED
companies just as Western Electric does
for A. IT. & II.
In May, 1928, the company made an
important addition to its foreign hold
ings by obtaining control of the Mackay
Companies which operate Postal Tele-
graph and Commercial Cables These
companies have telegraph systems COW
ering United States. with connections
in Canada and Mexico and cables ex-
tending over the Atlantic to Europe,
the Pacific to the Orient, and the
Caribbean to South America.
With its subsidiaries. the I. T. & r.
is engaged in telephone. telegraph,
cable, wireless, television and telephoto