1. Our job: to serve as equity analysts for the Regents’ portfolio – sell a particular point of view about a stock. It is not to summarize other analysts’ work. – Come up with a target price – Give a recommendation: buy/hold/sell 1

2. How are we going to do it? – Fundamental analysis use information provided by the company to come up with a valuation for the company Supplement information from the company with industry and macroeconomic information 2

3. Roadmap – Business analysis Internal resources and capabilities competitive strengths and weaknesses – Industry analysis Actions of competitors and customers Opportunities and threats 3

4. Roadmap – Financial statement analysis Accuracy, sustainability, and predictability Composition of returns Capacity for investment – Forecasting Reflects the analyst’s opinion on the stock Depends on what the analyst has learned from the business and industry analysis, and the financial statement analysis Needed for valuation 4

5. Roadmap – Valuation Come up with a target price Techniques – Discounted cash flow valuation – Valuation using multiples – Take a position: buy/hold/sell Investment thesis – Specific reason/s for the recommendation – Concrete milestones that the company must achieve or meet 5