N&W in 1911--Financials

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Bluefield Daily Telegraph
January 20, 1911

DECADE HAS DOUBLED ROAD'S EARNING POWER
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Norfolk and Western One of Strongest Stocks on Wall Street List During Last Few Weeks
    For some weeks past, Norfolk and Western has been one of the strongest stocks on the list, and Wall street [sic] has attributed its actions to buying by the Pennsylvania Railroad.  Certainly some one has been trading heavily in the stock within the past two years, for during 1910 569,013 shares changed hands, compared with 234,531 shares and 243,019 shares, respectively for 1908 and 1909.  As to who has been buying the stock, Wall street may and may not find a clue in the forthcoming annual report of the Pennsylvania, covering the twelve months ended December 31.  It is now necessary to wait, however, to find why interest in the stock has increased.
    During the past ten years Norfolk and Western has practically doubled its earning power, gross per mile having increased from $9,079 to $17, 972 in 1910.  In the meantime, net income per mile has increased from $3,900 to $7,721 per mile.  In 1900 the company earned 5.2 per cent on its stock, and paid no dividend.  Last year five per cent was paid on the stock and the surplus applicable to dividends amounted to 11-1/2 per cent.  For the five months of the current fiscal year gross earnings increased $1,016,000 and net decreased only $258,000.  For the same five months, Baltimore and Ohio showed an increase of $2,111,000 in gross, but a decrease of $1,409,000 in net.
    Last October shareholders of Norfolk and Western authorized an increase of $50,000,000 in stock and $30,000,000 in convertible bonds to enable the company to carry out its improvement plans, including the construction of double track and extensions.  Presumably, the company intends to sell either one or the other when the market conditions are favorable.
    Until that time, however, current earnings above the five per cent dividends are being spent for improvements and betterments, the amount so charged off last year being $3,578,000, against $1,730,000 for 1900 and $3,360,000 for 1909.  Since 1908, total expenditures for improvements and betterments aggregate $76,861,000 of which $53,519,000 has been charged to capital and $23,432,000 to current earnings.
    In 1906 Pennsylvania sold $16,000,000 of its Norfolk and Western, together with large blocks of Baltimore and Ohio and Chesapeake and Ohio.  All of the Norfolk and Western sold in 1906 was repurchased in 1909.  What was done during 1910 remains to be seen when the annual report is issued early in March.
    During the past ten years Norfolk and Western has ranged between 53-1/2 and 108-3/8 as shown in the following table:
[Details of table omitted here.]
    Norfolk and Western paid its first dividend in 1901, and the rate was two per cent.  The next year two and a half per cent was paid and in 1903 a further increase to three per cent was authorized.  In 1905 the stock was placed on a four per cent basis and the following year the rate was raised to five per cent.  In 1908 only four per cent was paid, but in 1909 the five per cent rate was restored.
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[Some digits, generally in the lower value positions, were indistinct on the microfilm and the best interpretations are shown.]

Gordon Hamilton
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