Show s st t I S SPLIT POCK ACTIVITY TO ToI INCREASE Last year owing to the generally poor stock block market atmosphere stock-split stock activity was the third lowest in over a decade The peak period for Cor forstock forstock stock splits on the New York Stock Exchange was in 1969 when business for the most part was exceptionally brisk corporate corporate corporate cor cor- earnings were generally rising and stocks were soaring None of these factors were in evidence last year More Favorable Conditions This year there seems little doubt but that general economic conditions will turn turnout turnout turnout out to Lobe tobe be better than in 1975 and thus corporate profits are almost certain to be higher And the stock market which has already had a sharp advance this year should hold up reasonably well barring some unforeseen adverse event So there will most likely be a good increase in stock splits this year over last Improving The Marketability Among the various reasons for a corporate decision to split split a stock is the desire to improve the marketability of the company's company's company's com com- pany's shares and broaden the ownership base A stock split does docs U this s as it increases the number of shares available and lowers the price of such shares Thus a larger number of investors investors investors in in- can participate in company ownership In general smaller investors tend to avoid higher priced higher priced issues as they are not able to buy in round ro nd lots and nd are unwilling to buy odd lots because of the cost differential Selecting The Candidates In recent years the most popular price level for stocks has been between 25 and 50 per sharer sharel More investors have purchased a meaningful number of shar shares s- s sIn in this general range than at higher prices Therefore grade good-grade issues issues priced at from more than 50 to or higher can often be considered as stock-split stock candidates There have of course been many instances when stocks priced at 50 or under have been split The split ratio will not necessarily be 2 for 1 but may be any multiple or percentage A dividend increase usually accompanies a stock split almost invariably spurring a astock astock astock stock price advance upon an of the split In theory however a split provides no advantage to the be shareholder in basic terms since he merely has more pieces of paper but the same proportionate equity in the company as before Listed below are some of the companies seen by the Research Department of Babson's Reports as being in a position to split their stock or declare important stock dividends this year The companies are listed followed by the low high-low and recent price Atlantic Richfield 76 86 Bristol Myers 79 47 77 Burroughs 61 Ponds Chesebrough-Ponds 67 37 62 Cola Coca 95 53 90 Diamond Shamrock 70 22 67 Eastman Kodak 63 Edison Brothers 53 18 48 Exxon 94 65 90 Federated Department Stores 57 26 51 Getty Gelty Oil 11 Halliburton Packard Hewlett-Packard 56 IBM International In Paper 73 35 71 McGee Kerr 95 60 74 May Department Stores 50 22 43 MCA 89 28 89 2878 78 McDonalds McDonald's 63 27 n 62 Merck 86 58 72 Monsanto Monsanto Monsanto Mon Mon- santo 96 41 93 PepsiCo 77 41 1 74 Philip Morris 59 41 56 Procter Gamble 79 89 Revlon 82 47 76 Reynolds Industries 67 50 65 Plough 67 45 55 Skelly Oil 70 54 70 43 64 61 Stauffer Chemical 40 Texas Instruments 61 Time Inc 70 25 67 Union Camp 91 37 90 and Wrigley 72 41 69 |