“Moving The Cheese” Portfolio Analysis: Dashboard Diagnostics January 20, 2010 Presented by: Mark Robertson Founder and Managing Partner – .

““Moving The Cheese”Moving The Cheese”

Portfolio Analysis: Dashboard Diagnostics Portfolio Analysis: Dashboard Diagnostics

January 20, 2010

Presented by:

Mark RobertsonFounder and Managing Partner –

www.manifestinvesting.com

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Dashboard DiagnosticsDashboard Diagnostics

Club History & CharacteristicsClub History & Characteristics

Club Name: “Anonymous” (Cheese Movers)

Location: Midwest

# of Members: 16 (Ladies)

Founded: 1994

The group includes a retired banker, a nurse, retailer, small business owner, dietician, physician’s

assistant, teacher and a lawyer ...

The genesis of the club is a quest for learning. The ladies wanted to learn more about investing and

the world of finance without involving their husbands or stock brokers.

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Club Long-Term Performance (5-Year Returns)Club Long-Term Performance (5-Year Returns)

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Current Dashboard (Report Card)Current Dashboard (Report Card)

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0% 5% 10% 15% 20%

PAR

1. Return Expectations ...1. Return Expectations ...

With MIPAR at 8.6%, our target range for the overall portfolio PAR is 13.6-18.6%. Our objectives will include

the “hunt” for some higher return candidates.

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50 55 60 65 70 75 80 85 90

Quality

2. Quality ...2. Quality ...

As is the case with the typical Better Investing-based investment club, the overall average quality is relatively

high (77.7) and the club holds many blue chip companies in its portfolio. The financial strength and

EPS Stability ratings are also quite high.

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3% 5% 7% 9% 11% 13% 15%

Sales Growth

3. Forecasted Sales Growth ...3. Forecasted Sales Growth ...

We pay attention to overall forecasted sales growth for purposes of size diversification. One of the most

powerful portfolio design and management parameters is to have enough growth ... aiming for 10-12% as a

portfolio average.

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Forecasted Sales Growth (Size Diversification) ...Forecasted Sales Growth (Size Diversification) ...

25%

50%

25%

Small (>12%)

Medium

Large (<7%)

The general target for size diversification is 25% Large, 50% Medium and 25% Small.

Hmmm. We can’t get much closer.

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Opportunity Map & Sector Diversification ...Opportunity Map & Sector Diversification ...

8% 0%

31%

8%0%17%

21%

14%1%

FinancialsEnergyHealthcareStaplesCommunicationsTechnologyDiscretionaryIndustrialsCash

0% 5% 10% 15%M

ater

ials

Indust

rialsUtil

ities

Discr

etio

narySta

ples

Comm

unic

atio

ns

Technolo

gyEnergy

Health

care

Finan

cial

s

Source: www.manifestinvesting.com/dashboard/1835

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Medco Health (MHS)Medco Health (MHS)

Sales Growth Forecast = 8.0%

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Net Margin Forecast = 2.1% (Value Line is using 2.5%)

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Projected Average P/E = 20x (based on VL, M*, S&P, SSG ...)

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16



?

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Sell Medco (MHS) and Accumulate 14.87 shares of Strayer (STRA) to bring the holding up to 50 shares and approx 7% of

total assets.

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Criteria: PAR = 13.6-19%, Sales Growth > 10%, Quality >70

CASPI > 90 (CAPS All-Stars % Expected to Outperform)

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Jinpan Intl* (JST)Jinpan Intl* (JST)

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Techne (TECH)Techne (TECH)

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Buy 150 shares of Jinpan Intl* (JST) ... Raising the portfolio PAR to 11% and maintaining quality and overall sales growth.

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Think Results. Impact. Before and After. Bigger Picture.Think Results. Impact. Before and After. Bigger Picture.

Before. After.

The sale of MHS and the addition of JST moves the overall portfolio PAR and average sales growth forecast in the right direction.

Think cadence and steady discipline.

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Morningstar Wide Moat Leaders (WMW)Morningstar Wide Moat Leaders (WMW)

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Bivio dozen (1/20/2010) Bivio dozen (1/20/2010) www.manifestinvesting.com/dashboard/12218www.manifestinvesting.com/dashboard/12218

Published monthly, the bivio dozen is a listing of the top 1% of all stocks covered by MANIFEST – based on a combination of PAR and Quality.

“Moving The Cheese” Portfolio Analysis: Dashboard Diagnostics January 20, 2010 Presented by: Mark Robertson Founder and Managing Partner – .

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