COMPANY NOTES
BY CUSTOS
BUSINESS on the Stock Exchange has broadened—Monday was the busiest since May—but the gilt-edged market came back after its rise, being sensitive to rumours from Jordan and the wage claims at home. The industrial markets remained firm, encouraged, no doubt, by the success of the GEC issues. The new GEC 6 per cent. loan stock is now 21 premium and the new ordinary shares issued at 40s. are at 5s. premium, which they fully deserve. Property shares are gradually responding to the Government's decision to amend the Rent Restriction Acts. LONDON COUNTY AND FREEHOLD have moved up to 26s. to yield 5.3 per cent. on the 134 per cent. dividend. ARTIZANS AND GENERAL PROPERTIES, Which stands to benefit most, is now 25s. 9d. to yield 5.2 per cent. on the equivalent 6.7 per cent. dividend, which I expect to see raised for the current year. Oil shares have gone up and down with the political news. A reader asks why I have changed my opinion of Burmah Oil. As to its intrinsic merits I have not varied at all—it remains the cheapest way of buying BRITISH PETRO- LEUM and its Indian business is offered to the investor free—but while there is a daily risk of a revolution in Jordan and a war between Israel and her neighbours I believe that current yields from BURMAH OIL and BP are not good enough. SHELL and ROYAL DUTCH are also affected but not so heavily. Speculators are now turning to ULTRAMAR on the chance of good news from its Venezuela drilling and its reported venture into Canada. The shares have jumped to 49s. 3d.
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CANADIAN EAGLE did not respond to the excellent half-yearly report which increased rather than lessened the mystery which attaches to the shares. No comparison was given with the corresponding period of 1955, but on the 1955 yearly average profits are about 8 per cent. up. There was a sharp
fall in UK taxation which needs expla tion. Earnings for the six months app to be 2s. 8d. per share. As the last ann dividend 'grossed up' was 2s. 2.4d. share there is good scope for a divide increase. At 65s. the bearer shares yl 3.3 per cent., and if the whole truth co be told about them they would proba be a good exchange from oil shares si a Middle East risk.
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Another reader wishes to take an intel in British investment trusts which havl large stake in American and Canad equities. These are usually the go-ahl Edinburgh trusts and I find that BRIT. ASSETS, SCOTTISH INVESTMENT, SECOND THIRD EDINBURGH INVESTMENT, SECC INVESTORS MORTGAGE, SECOND SCOTT INVESTMENT and SECOND SCOTTISH Mb GAGE all have between 40 per cent. g 44 per cent. of their portfolios invested dollar securities. The most interesting those whose shares have not fully ( counted the potential rise in their fi dividends due to be declared next mor, For example, Scottish Investment ral its interim from 6 per cent. to 10 per C( and its previous final was 29 per cent. this were raised to, say, 35 per cent., the shares at 36s. 9d. would yield 6 per cg Second Scottish Mortgage increased interim from 5 per cent. to 8 per cent. g its final may be raised from 14 per c( to 20 per cent. The stock at 450--none offer as I write—would then return 0 6 per cent. Third Edinburgh Investm last year only distributed two-thirds of earnings and paid a dividend of 20 cent. The market thinks it will pay 28 , cent. this year, which would allow a Y1 of 64 per cent. on the stock at 448. market prices in all these cases are, course, well below the break-up vall It would not be surprising to see them 51' upwards against the market trend.
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