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2nd-Quarter Prices of Area Stocks Mixed

July 08, 1986|JAMES BATES | Times Staff Writer

Stock prices for public companies in the San Fernando Valley area leveled off in the second quarter after rising sharply in the first three months.

Losers and gainers were split evenly in the quarter ended June 30 among the 63 publicly traded companies in the area tracked by MPACT Securities, an Austin, Tex.-based firm that computes stock-price information for The Times on companies with headquarters or more than 2,000 employees in the San Fernando Valley-area. Thirty-two of the stocks rose in the quarter and 31 dropped.

Out of 60 stocks tracked in the first quarter, 47 were up and 12 were down.

The second-quarter performance of the stocks of Valley-area companies mirrored the performance of the overall market over the three-month period. MPACT's index of Valley-area stocks, a gauge of performance that weighs all of the stocks equally, rose less than 4% in the quarter.

By comparison, the Dow Jones Industrial Average, the most closely watched stock market indicator, rose slightly more than 4%. The OTC composite index, a measure of the over-the-counter stock market, did better, rising 8% in the quarter.

The biggest gainer among area companies was Olson Industries, a Sherman Oaks-based company that makes plastic packages and distributes eggs. The company's stock price surged 227%, or about $25 a share, to close at about $36 at the end of the quarter.

Investors Sniff Out Issue

Jonathan Berge, Olson's executive vice president, said he believes it was a delayed reaction by institutional investors to its report of a profit of $870,000 for the quarter ended Dec. 31, in contrast to a $164,000 loss in the year-earlier period.

The biggest drop was recorded by American Ecology, which fell $17.50 a share, or 40%, to slightly more than $26 following a $16-a-share jump in the first quarter. The Agoura Hills-based waste-management firm reported a 60% drop in net income for the quarter ended March 31 because of sharply lower revenues in its low-level radioactive-waste disposal business.

Another large company whose stock dropped sharply was Marantz, a Chatsworth stereo and video-equipment firm. One of its largest customers, Pacific Stereo, filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code in the quarter. Marantz's stock fell nearly 29%, to about $7.50 a share.

Major gainers included the Cherokee Group, whose stock climbed 73% in the quarter to close at $30 a share. The North Hollywood-based clothing firm, one of the area's strongest performers in the stock market, has been showing big quarterly profit increases over the last year because of a turnaround in its shoe operations and continued strength in its apparel divisions.

Developments Spur Interest

Another strong performer among major companies was Amgen, a Thousand Oaks biotechnology firm, whose stock rose more than 35% in the quarter to nearly $25 a share. Biotechnology stocks in general have been strong this year in the wake of developments in the field that some investors believe will lead to the marketing of highly profitable medical products.

Fairmont Financial, a Burbank workers' compensation firm that has been posting strong profit increases, rose $8 a share, 34%, in the quarter. In the first three months of the year, Fairmont reported a 180% increase in earnings, to $1.4 million.

Stocks of some Valley-area companies rose after stock splits. The stock price of Hamburger Hamlets, a Sherman Oaks restaurant chain, rose 60%, or $11.50 a share, to more than $30 a share after the company split the stock 4 to 1 and paid a dividend to its shareholders.

Splits, which create more shares in a company, sometimes help raise the stock price of small firms with few shares outstanding by creating a more active market.

Major high-technology stocks in the area, hurt by the continued industry slump, were mixed in the quarter. Tandon, the Chatsworth computer-products company, rose 19%, to more than $6 a share. Dataproducts, a Woodland Hills computer printer maker, fell 7%, to $14 a share, and Micom Systems, a Simi Valley maker of computer communications equipment, fell 15%, to less than $13.

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