Bluest of the Blue Chips

To millions, the picture of Alexander Graham Bell on each share of American Telephone & Telegraph Co. stock is as soothing and comforting as that of George Washington on the dollar bill. The firm's 812.8 million shares are owned by 3,026,000 people and institutions, more than the population of Los Angeles or more than the stockowners of any other U.S. company. General Motors is not even a close second with almost 1.2 million.

The great majority of AT&T shareholders are small investors. Only 139,038 people and organizations own more than 600 shares each, while 938,457 have fewer than 20 each. Impresario Billy Rose once owned 80,000 shares of Telephone worth $11.2 million and liked to brag that he was the company's largest single shareholder. Today the largest block of stock is controlled by the College Retirement Equities Fund, a pension plan for teachers, which has 7.2 million shares worth $423 million.

AT&T has for years been considered a stock for "widows and orphans" because it was virtually risk-free and paid good dividends for 100 consecutive years, even during the Great Depression. For the past two decades, those dependable dividends have been the stock's most attractive feature. Since 1960, they have increased from $1.65 to $5.40 per share, a 9.2% return based on last week's final close. The price of the stock has not performed nearly so well. Over the past five years, it has been relatively stagnant, trading at between $45 and $66 per share.

Rarely has AT&T attracted the attention of stock market traders as it did last week, following the company's agreement to split off its 22 local telephone operations. Trading in the stock was held up twice because the New York Stock Exchange was flooded with more orders than it could handle. Among them was one for an immense block of 1.3 million shares that was eventually acquired for $78.8 million. By the time the hectic week was over, 6.2 million shares changed hands. AT&T closed the week at 58 3/4, up 1/8.

Wall Street watchers expect that the new AT&T will no longer be a stodgy, lackluster stock. Shares in the core of the company, which will be competing in the glamorous but risky high-technology industry, are expected to be volatile in price, but highflying. Says Seth Glickenhaus, who already holds a large block of shares through his investment advisory firm of Glickenhaus & Co.: "AT&T will be an outstanding technological company." But other analysts fear that products from the new Ma Bell may not turn out to be profitable. As for the 22 local AT&T companies, or their survivors, they are less likely to be large profit makers or an attractive investment because states closely regulate the rates they can charge for phone services.

No one yet knows exactly what AT&T shareholders will own when the company finally splits up. Wall Streeters speculate that investors will eventually exchange their AT&T stock for shares in both the new Ma Bell and in one or more of the local companies.

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