Show BUSINESS and end the tha STOCK MARKET by BABSON'S REPORTS INC Copyright 1973 STOCK SPLIT CANDIDATES FOR 1973 Stock splits may reach a new time newall time all high this year due largely to the expected continuation of f a generally good stock market and to high corporate earnings Last year a record companies split spilt their stock of paid stock dividends of percent or more topping the previous high of for 1969 The largest number of splits last year occurred in the first half haU and the same ame will probably be true this year WHY THE SPLITS The primary aims alms behind a corporate d decision cislon to split the stock are to increase the number of shares available and to lower the price of f such shares Most managements managements man man- lIk like to to have their stock actively active active- ly traded and in recent years the most popular price pric level for investors purchase appears to have been between 25 and 50 a sh share re Purchases Purchases' can then usually be made in round lots of shares which is preferred by most traders So when a astock astock astock stock reaches the 50 50 area it is generally generally gen gen- regarded as a logical split candi candi- date A split of course does not have to beon be beon beon on a for l 1 basis it can be any multiple multiple mul mul- tiple or percentage thereof Also Als there is no assurance that a stock will split spilt when it reaches the 50 50 range many is issues issues is is- sues have sold at or above these levels for years without splitting By the same token many stocks have been split under 50 a share OTHER FACTORS Recently there have been other factors influencing stock split decisions One has been government limitation on dividend boosts to 4 percent over the average pay payout payout pay pay- out in the past three years This is unrealistically unrealistically un un- realistically low for many firms Thus in order to sweeten the pot for stockholders stockholders stock stock- holders many firms have split the stock and then given a small increase in cash payment A split by itself of f course does not mean any additional income for the holder Another factor which has spurred stock stock- split activity over the past year or so has been the revised standards for listing listing list list- ing on both the Big Board and the American Am Stock Exchange For example to tobe tobe tobe be listed on the New York Stock Exchange Ex change a company must have a minimum of one million publicly held shares On the American Exchange a minimum of shares is required for listing and there must be a minimum of 1200 stock stock- holders up from the previous LISTED BELOW are several companies compan compan- favorable ies whose stocks appear to be in a favorable ora ble position to split or at least to pay an important stock dividend this year They are all doing well and are currently near and in many cases ases their above high levels of f the past twelve months Company 1972 Range Recent low High Price American Home 86 86 AMP Inc 13 69 9 Atlantic Richfield 78 78 48 48 78 Avon Products 94 94 Black Decker 77 77 Burroughs Ponds Pond's 89 89 56 56 88 Digital Equipment 69 69 98 Dow Chemical 78 78 Emerson Electric 96 96 77 77 93 General Electric 73 73 58 58 72 Halliburton 14 67 67 7 Packard Hewlett 88 88 46 46 90 McDermott JRay JUay 73 33 73 32 78 Merck 1 90 90 69 69 94 Morgan 1 JP J.P. 72 no Motorola 1 80 0 Philip Morris 1 U 68 68 Plough Plough 83 83 Searle GD 72 72 Sears Roebuck 97 97 Corp 76 76 53 52 74 Squibb 81 UD 81 Standard Oil Ind mead 88 88 61 61 88 71 71 |