In case you haven't noticed, this has not been one of the best times to own stock in companies that make their homes in the Washington region. The stocks of defense contractors, real estate companies, banks and thrifts have all been depressed for months -- a condition that has been obvious to even the most casual reader of the stock tables.
What has not been so obvious is that there are many other types of Washington area companies whose stocks also have been on the minus side of the ledger this year. And, worse yet, stocks in the Washington region are faring even more poorly than local stocks elsewhere.
For this latter insight, we are indebted to Jordan E. Goodman, a senior editor at Money magazine, who recently studied the performance of stocks in 40 areas of the nation. Goodman's findings are summarized in a chart that appears in the August issue. The magazine's rankings are based on how the stocks behaved during the 12 months ending June 30. Performance figures also were provided for the past two years and three years.
What the chart shows is that Washington ranks 38th out of the 40 areas surveyed. The Washington figures, Goodman said, are based on the Johnston, Lemon & Co. index of 30 local blue-chips. Comparable indexes, he said, were used for the other regions.
Washington area stocks lost 11.95 percent in one year, gained 9.79 percent over two years and gained 7.80 percent over three years, all ending June 30.
Baltimore area companies did much better for the one-year period, and thus wound up in 19th place. Baltimore stocks were up 2.28 for one year, up 2.78 for two years, but lagged badly over the three years, with a tiny gain of 0.86 percent.
The table did not contain a specific summary for Richmond area stocks.
The nation's top performing area was Cincinnati-Dayton with a one-year gain of 31.74 percent. Stocks in Sacramento, Calif., lost 36.27 percent for the same 12 months, giving it the dubious honor of 40th place.
Although it was difficult to tell whether all the 40 indexes were truly comparable, there was no mistaking the trend.
Washingtonians have spent so many years thinking that this town is recession-resistant, that it has been easy to believe Washington area companies were faring better than the companies elsewhere.
The Money magazine chart shows that that belief to be erroneous. The point is confirmed when one looks at what has happened to the stocks of The Post 100 companies, the major 100 general business or industrial companies that are located in the Washington area. Financial companies are not part of that list.
Indeed, when one looks at the stocks of the 10 largest Washington companies, as ranked by revenue in the annual Post survey, all 10 stocks have lost ground since Jan. 1.
As of July 30, Marriott Corp. was off 38.6 percent; MCI Communications Corp. was down 14.5 percent; USAir Group Inc. lost 33.3 percent; Martin Marietta Corp. fell 13.8 percent; Gannett Co. Inc. dropped 19 percent; Giant Food Inc. was off 5.3 percent; Geico Corp. was down a slight 0.2 percent; Lafarge Corp. was off 7.2 percent; The Washington Post dropped 11.9 percent; and Ryland Group lost 13.9 percent.
The picture wasn't much better in the next 10 companies, which saw nine losers and one winner, Danaher Corp., which was up 42.6 percent. Danaher, owned by the Rales brothers of Washington, is a holding company for a collection of industrial firms.
The nine losers were Potomac Electric Power Co., which fell 16.2 percent; NVR L.P., off 75 percent; Hechinger Co. "B" shares, down 6.9 percent; Dart Group Corp., off 3.2 percent; Washington Gas Light Co. fell 5.6 percent; Manor Care Inc. dropped 19.4 percent, Harman International Industries Inc. slid 42.6 percent; Rouse Co. was down 24.5 percent; and UNC Inc. lost 16.7 percent.
Thus, only one of the top 20 companies on The Post 100 list showed gains since Jan.1.
The picture begins to improve when one gets deeper into The Post 100 list.
American Capital and Research Corp., a newcomer to the public company list, was up 50.9 percent; American Management Systems Inc. gained 56.7 percent; PHP Healthcare Corp. was up 74.2 percent; Mid-Atlantic Medical Services Inc. picked up 193.2 percent; Penril Corp. gained 43.5 percent and Sage Software climbed 56.3 percent.
Generally, the companies that are still showing strength in the stock market are those in specialty computer work, health-related activities or are companies that have seen bad times and now are enjoying a turnaround.
Even so, out of all The Post 100 stocks, losers outnumbered gainers by about 7-to-3.
It should not be forgotten, perhaps, that long-term shareholders in many Washington companies still enjoy the gains accumulated over the years.
But what clear is that there is a downward trend that goes beyond the banks and thrifts and home builders and defense contractors. The continuing slide has caught up with insurance companies, food markets, lumber yards, bakeries and other kinds of retail and service firms.
All in all, if the stock market is to be believed, there is a big dent in Washington's long-held reputation for fighting off recessions.
three-year-old Bethesda company, General Imaging Corp. is trying to raise $650,000 to $1.3 million, by selling between 100,000 to 200,000 units at $6.50 a unit.
Each unit will include 10 shares of common stock and 10 warrants that can be used to buy 10 more shares of stock at $1 each during the next three years.
Then offering is being handled on a "best efforts" basis by William Barton Financial Inc., of Chicago, meaning that the underwriter does not promise to buy and resell the shares.
General Imaging, as its name suggests, is a company that specializes in computer graphics, which are often displayed during that quintessential Washington event -- the "Presentation." A presentation generally is made to anyone who is one or more rungs higher on the executive or military ladder.
General Imaging, the company reports, has installed one of its graphic systems in the Situation Room at the White House and installed others at the Pentagon and CIA. The company, however, does not have much of an operating history. From 1988 to 1989, the young firm's sales doubled to $1.7 million from $860,000 while its profits moved up to $33,153 from $21,740.
The chairman, president and chief executive of General Imaging is Nathan B. Golan, 27, who founded Perspective Technologies in Columbia, Md., also a computer graphics company, which was sold to Megatek Corp., a subsidiary of United Telecommunications Inc.
Golan, who now owns 70 percent of the shares, will own 47 percent if the company sells only the minimum amount of shares, but only 35.2 percent if the maximum amount are sold. However, the prospectus points out that even if the maximum number of shares are sold, company executives will still own about 50 percent of the company and will have control of the board.
Given the disasters befalling banks and thrift stocks, are there any still worth owning?
Yes, says John A. Heffern, an analyst at Alex. Brown & Sons Inc. in Baltimore, pointing to Maryland Federal Bancorp., the parent of Maryland Federal Savings and Loan Association, which operates 16 retail offices in the Maryland suburbs and has $717 million in assets.
Heffern rates the thrift as a "hold" for long-term investors. He likes the fact that the thrift's lending activities are heavily concentrated in residential mortgages.
Even so, Heffern sees some risk at Maryland Federal, if rising rates cut into profitability. However, falling rates can have an opposite effect.
Heffern estimates that the thrift's earnings will rise from 81 cents in fiscal 1990 to $1.10 in fiscal 1991, and $1.25 in 1992, all ending in February.
Despite the somewhat rosy picture for Maryland Federal, the climate for thrift stocks is such that Maryland Federal, which was as high as $15 during the last 52 weeks, is now selling at $7.37 1/2.