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The divergence between the Dow Jones Industrial...

The divergence between the Dow Jones Industrial Average and the broad U.S. stock market seems to be narrowing, said Irving Katz, director of research at Thomas Green/San Diego Securities.

Many stocks have moved up in tandem with the Dow index, which has risen six consecutive days and is only off 3% from its all-time high, reached Jan. 2 of this year.

HomeFed gained $1.625 for the week. At its annual meeting last week, chief executive Robert Adelizzi pointed out that HomeFed finished the most turbulent decade in the history of the savings-and-loan industry with its most profitable year ever in 1989 and its best first quarter ever for the period ended March 31.

HomeFed stock is selling at a little over five times earnings, at a 35% discount to tangible book value, and “remains a buy in my eyes,” Katz said.

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Warren Buffet’s increase in his investment in PS Group to 11% of the shares outstanding made the stock the largest point mover of the week, gaining $3 to $37. Most of PS Group’s shares are held by value-oriented investment managers who invest for the long term.

Other solid gains were posted this past week by Rohr Industries, up $2; San Diego Gas & Electric, up $1.50; BSD Bancorp, up $1.25, and Cubic Corp., up $2.25.

Great American Bank continued its descent, giving up another $.50 to $2.75 as the proxy statement and 13-D filings showed that Ed Wedbush, the S&Ls; largest shareholder, sold about 800,000 shares during the last month. The question remains whether the sale was because of a loss of faith by Wedbush or a forced liquidation related to margin calls.

Triton Group Ltd. continued to drop and fell $1.125, to a new low of $7.875. Its proposed merger with Intermark would entitle owners of one Triton share to 1.4 shares of Intermark, which closed Monday at $7.625.

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Also on the downside, Magma Power dropped $1.50 and Price Co. dropped $1.25. Price fell to a new low of $32.50, at which point it is selling at 11 times next year’s consensus earnings forecast of $2.93 a share.

Advanced Marketing Services hit a new low of $4 when it announced that it would have a loss of 15 cents a share for its fourth fiscal quarter, resulting in earnings for the fiscal year ending March 31 of 30 cents a share.


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