BUSINESS &. FINANCE

In α Sagging Market This Year . . Some Chemicals Have Held Up Better . . .

Air Reduction American Potash Commercial Solvents Harshaw Pennsalt Victor

Than Others

American Cyanamid Dow Hooker Koppers Minnesota Mining Monsanto Union Carbide

•

Price

Dec. SI

5 0 7 2 52V·, 17Va 27 56 26

1956-57 Low

36 V, 43 16V2 24 46 26

Recent

48 51 17V* 26V 2 59 27

79V2 67 38 65V, 67 367 =

116

61 D / 33 517* 587 a 31

1007.

67 59V, 34 55 58V 2 32

104

% Since

Dec. SI

—5 —3

0 — 2 4-5 4-4

- 1 6 - 1 1 - 1 1 - 1 6 - 1 3 - 1 2 - 1 0

Change

Since Low

+ 3 2 -f-19 +6

4-10 4-28

4 4

4-10 ! 4 4 4 3 4 7

0 4 3 4 3

Wall Street Takes a Tumble In a weaker market, prices of many chemical stocks broke this month to lowest levels since 1955

T H I S MONTH Wall Street made the front pages. The reason: Stock prices slumped sharply on Feb. 11 and the day following to the lowest level since late 1955. In the parlance of lower Manhattan, stocks broke through a "support level" which h a d held firm for the past 15 months w h e n the Dow-Jones industrial average dropped be­low 460. The subsequent rally, de­scribed by many as only a "technical re­action," brought little cheer to those who saw it as a temporary rebound after the previous selling wave.

The slump carried wi th it an im­posing array of chemical shares. Hit­ting new 1956-57 bottoms were such blue chips and growth favorites as Al­lied Chemical, Union Carbide, Mon­santo, Hooker, and Spencer. Prices of most of the other leading chemicals were not much above their lows of the past year or more. As a result, millions of dollars have been clipped off inves­tors' portfolios. Since the start of the year, for instance, the market has chopped more than $350 million off its valuation of all Union Carbide shares outstanding, over $100 million off both American Cyanamid and Dow.

• Why the Drop? Market analysts were laying the blame in several direc­tions at once.

One very tangible factor affecting chemical snares has been apparent for nearly a year: Competition is increas­ing and profits are not keeping u p with rising sales because rising costs a re pinching margins. Thus, earnings re­ports this year are not nearly so sparkling as a year ago. Earnings in many cases have either declined (Al­

lied, Dow, Monsanto, Hercules Pow­der) or are ahead b y only a modest amount ( Union Carbide, American Cy­anamid, Hooker) . So many investors have been wondering if the more highly priced chemicals have not been evaluated too optimistically—in terms of future growth alone.

Tight money, too, is a factor. Yields on bonds have risen to a point where many investors find a corporate deben­ture offering more than 4 % interest a more tempting buy than a chemical stock like Dow or Minnesota Mining that yields less than 3%. Moreover, a raft of new corporate security issues have been offered in the last couple of months to sop up great quantities of investment money. As one analyst puts it, "The market is suffering more from neglect than anything else."

And don't forget the psychology of the market place. There are just enough clouds on the economic and international horizon to sap at investors' confidence. Many market advisors have been flashing caution signals re­cently in their reports, and signs that the boom may be leveling off have caused agonizing reappraisals on the part of many stockholders.

But underlining the cross currents that play through any market, some chemicals have turned in relatively steady performances in the face of the fall. Some, of course, hit their low point last year and have just clung there. But on the other hand, glamor has not completely worn off prospects of expansion and opening of new fields. Acetylene chemistry, as well as in­creased demand for industrial gases from busy metal industries, has kept interest alive in Air Reduction. Boron has done the same for American Potash and fluorine chemistry for Pennsalt.

Another important factor in recent market swings has been investors' evaluations during the past year or so. It is largely the market leaders in the 1954-55 upswing—those companies whose future earnings were regarded most optimistically—that have been most volatile on the downside, too. •

1954 1955 1956

1 0 6 C & E N FEB. 2 5, 1957

i t pays t o order

BLOCKSON phospffat es

in mixed car or truck

loads

WAREHOUSE STOCKS AT ALL

BLOCKSON DISTRIBUTORS

FEB. 2 5, 1957 C&EN 1 0 7

You can combine any or al l Blockson chemicals in one car or truckload and receive the carload price on each item. You'll find that this "one stop" purchasing simplifies your scheduling. A collect phone call to Blockson in­stantly expedites any unforeseen needs.

You'll carry far less inventory, since Blockson can be depended on to vary the flow of Phosphates precisely to your changing re­quirements regardless of chang­ing market conditions. For fur­ther information, call Blockson or your Blockson distributor.

B L O C K S O N C H E M I C A L C O M P A N Y Division of Ol in Mathieson Chemical Corporation

Joliet, Illinois

Also major producers of: Hydrofluoric Acid Sodium Silicoffuoride Sulfuric Acid Hygrade Fertilizer Sodium Fluoride Teox 120

Nonionic Surfactant

ONE STOPFOR SODIUMPHOSPHATES

NOW... HIGH MOL-WT. Di- and Tribasic Acids

Top: Mol. Wt. -565 Total Carbons -36 Viscous Liquid

Bottom : Mol. Wt. 845 Total Carbons 54 Viscous Liquid

Developmental modifications of the com­mercial product, Empol 1022 Polymerized Acid, are now available in limited quanti­ties. This opens up a considerably wider scope of research based on this unique concept of C3e dibasic and C54 tribasic acids. Similar to the commercial product, Empol 1022, which contains a dibasic to tribasic ratio of 75:25, and a 3-4 % mono­basic acid content, these new develop­ment grades are all stable, viscous liquids, further described as follows: Emery 3019-S: Predominantly dibasic with a dibasic to tribasic acid ratio of 95:5 and a normal monobasic acid con­tent of 3-4%. Emery 3079-S: Low monobasic acid counterpart of 3019-S. Possesses a dibasic to tribasic acid ratio of 95:5 but contains less than 1 % of monobasic acids. Emery 3065-S: Low monobasic modifi­cation of Empol 1022. Contains less than 1 % monobasic acids and a dibasic to tribasic ratio of 75 :25. Emery 3O20-S: Similar to Empol 1022 but has a reduced unsaturated acid con­tent. It is extremely stable to heat and oxidation and possesses a light color. Emery 3Q55-S: Predominantly tribasic with a dibasic to tribasic acid ratio of 15:85. Contains no monobasic acids. For further information, mail coupon below.

^jtmn\ i Development and Service Department

Emery Industr ies, Inc . C a r e w T o w e r , Cincinnat i 2 , O h i o

• Emery Industries, Inc. j Dept. C-2B, Carew Tower J Cincinnati 2 , Ohio J Please send Development Product Bulletins on 1 D 3019-S d 3020-S Π 3055-S j D 3065-S ~ 3079-S

.State

BUSINESS & FINANCE

New Line for Beckman Beckman Instruments p lans to ac­

quire Statham Laboratories in exchange for 400,000 shares of stock. Statham, whose annual sales are currently at a $5 million clip, manufactures pressure transducers, acceleromoters, a n d other devices used in aircraft and guided mis­siles and for measurement a n d control applications; plants are at Los Angeles and Puerto Rico. "The merger adds to our organization a leader in important instrumentation for physical measure­ment," says Beckman president Arnold O. Beckman.

During the six months ending last Dec. 3 1 , Beckman's shipments hit a record $17.6 million, up 3 7 % from the

same period of the previous year. Prof­its, however, d ipped to $708,000 (55 cents a share) from $759,000 (61 cents a share) in 1956. With orders during the six months of over $20 million, the company forecasts sales above $40 mil­lion for its current fiscal year.

Beckman cites two reasons for the earnings decline. It had to absorb non­recurring losses on some of its govern­ment contracts which will be completed this year. And research and develop­ment costs, u p nearly $1 million for the latest half year, were 6 7 % higher than a year ago. These expenditures are now about 1 3 % of sales.

Most of the rise is a result of in­creased activity in semiconductor and data processing research. Beckman ex-

£î£C >, >.* S25> » ^ - v O " *

ι IMDEX oè'sirobK ' P R I C E S 1 vk* JAN." '54 OPENING "PRlCES-100 . \ , >v

; ^ ^Υ^~>,'<Λ>^

EULP&Î PÂPElfel

j&Sij ' .

200

1501

100'

S E C Composite Index

• W s » ^ '

232.3

^-168.4

2ndQtr.(1956) 3rd Qtr. 4th Qtr. 1st Qtr. (1957)

FOOD PROCESSING

350,

300

250

200]

150

1001

S E C Composite Index ******* 168.4

« 11T.5

2nd Qtr.(1956) 3rd Q t r . 4th Qtr. 1st Qtr.(1957)

1 0 8 C & E N FEB. 2 5, 1957

pects both fields will soon pay off. Its Shockley Semiconductor Laboratory has now developed a new semiconduc­tor device and hopes to have prototypes under field evaluation soon. And it has orders for more than $4.5 million worth of data processing systems.

• St. Regis Paper's next acquisi t ion w i l l be St. Paul & Tacoma Lumber Co., Tacoma. Wash., producer of plywood, lumber, and wood chips. St. Paul & Tacoma also owns about 114,000 acres of timber in Washington. St. Regis plans to exchange 850,000 shares of common stock for St. Paul's 15,000; 450,000 shares wdll be issued as soon as the transaction is completed and 400,000 in three subsequent yearly in­stallments. St. Regis reports it earned $22.5 million ($3.15 a share) last year on record sales of $330 million; in 1955 it netted $19.0 million on a $257.1 million volume.

Process Industries Trends

CIGARETTES C o n s u m p t i o n , Use o f Tax Free

| A n d T a x Paid, in Bi l l ions Source: U.S. Dept. of Commerce

f * χ Ϊ - " - .» 4 V = W

\mwm 20 i &> - , ' ' * *% ' -

, u t i ι • ι r - i i t 1 = 1 *

/vVVV^i " N o v .

i l l - i l l Γ ι - 1 Γ ι ι

| 1955 1956

u

:; v

:'5f

ι ;

G U M AND W O O D ROSIN Stocks, End of Quar ters Source: U. S. Deportment Thousands of 520-Pound Drums of Agriculture

r;^v%f£; r-'

4th Qtr .

I l i J I I I I •ΠΒ1.-,-Μίν BB IB HI E l Ml 1955 1956

EXPORTS Chemicals and Related Products AAilhons of Dollars S o j r c e . u s D e p , o f C o m m e f c e

?' * ' '?'\

ί -^Λ^ν^^

r ~*· . y

,\S r^'^X^}: M M l - l ' l Ι Ι Ί 1

1955

i ^ V * * ^ V O e t .

\f 99.8

r r r 1 1 1 1 1

1956 t Ι Ι Ί

Want a Di- or Polybasic Acid that is DIFFERENT? Rz

nnnnnnrj R3

ΤΡΓΠΤΠΓ

?J©* R4

Top: M o l . Wt .—565 Total C a r b o n s -Viscous Liquid

3 6

R2

Bot tom: M o l . Wt .—845 Totol Carbons—54 Viscous Liquid

Then t ry EMPOL* POLYMERIZED ACIDS! Relatively low in cost, these viscous liquids offer a very unusual combina­tion of high molecular-weight and polyfunctionality that should be of extreme interest to manufacturers of resins, polyesters, polymers and similar type materials for many fields of application. Such fields already include adhesives, coatings, corrosion inhibitors, de-emulsifiers, emulsify­ing agents, films, foams, lube additives, elastomers and surface coatings.

In addition to commercial Empol 1022 which contains 7 5 % dibasic and 22% tribasic acids, Emery offers several "development" grades that are essentially all dibasic or tribasic. This added flexibility of composition offers additional opportunities for research in new fields as well as the fields where the commercial product is already used. Mail coupon below for complete literature on Emery Polymerized Acids.

Organic Chemical Sales Department

Emery Industries, Inc., Carew Tower, Cincinnati 2 , Ohio

Emery Industries, Inc., Dept. CÎA, Carew Tower, Cincinnati 2 , Ohio Please send literature on Emery Polymerized Acids. I am especially interested in • dibasic, | | polybasic materials for « -

Name Title

Company

Address [

City State j

F E B . 2 5. 1 9 5 7 C & E N 1 0 9