NORTHEASTERN UNIVERSITY Corporate Finance Professor Olubunmi Faleye Equity Research Report John Coogan November 18, 2010

ExxonMobil is a major force in Major Oils, with some 4.2 million boed of oil & gas production, and a global downstream portfolio, with 6.2 million b/d of refining capacity, and a world-scale petrochemicals business. The company has an emphasis on project scale and lifespan, with significan in-house research. As of December 31, 2009, it operated 16,587 gross and 13,737 net operated wells.

Energy: Integrated Oil and Gas

Ticker: NYSE:XOM Price: $70.48 (as of Nov-15, 2010)
Price of XOM / Price of S&P 500

Recommendation: Market Perform 12M Price Target: $75-$78

Neutral Outlook on ExxonMobile

Cannot recommend XOM BUY for several reasons: All stock buy-out of Houston-based
XTO Entergy Inc. has failed to develop as anticipated and deal structure may be overstating EPS gains to XOM. Although the 13.4x earnings paid for XTO appears accretive in the near-term, vaguaries about cost-reduction strategies and a weak outlook in the natural gas market both call this the future return on the acquition into question.

Natural Gas prices do not appear to be experiencing upward pressure. We believe that while oil prices are under structural upward pressure due to depleting high-return reserves, natural gas prices are not. Addtionally, natural gas supply has consistently reacted to higher prices resulting in preasure towards the marginal cost of supply. Through 2008 and 2009 oil production at Exxon has represented 2/3rds of their total oil and gas production. Trends in both global supply and Exxon strategy, including the XTO deal, point towards equivalent gas production as soon as 2011.

Relative out-performance unlikely given changes within Super Major net income per barrel rankings: XOM recently lost ground to other top producers and is now relatively cheaper than Cheveron. Underperformance in earnings growth and expected negative impacts from the XTO deal make sector out-performance difficult to imagine.

Valuation and Risks, details on page 5: Our DCF-implied target is $78 and our Earnings Multiple methodology yields $75. Downside risks to our neutral rating include political complications abroad, falling demand, the expensive XTO acquisition and potention changes in US tax code including renewable fuel legislation. Upside risks include surprise return on the XTO investment, rising commodity prices and positive developments in chemical production.

Equity Research Report - ExxonMobil


11%). Exxon has a reported 23. He also serves as the Chairman of the Board of Directions and has held both positions since 2006 and ascended to both after the retirement of longtime chairman and CEO Lee Raymond. refining and marketing (83%. Royal Dutch Shell.23 million barrels per day of atmospheric distillation capacity across the North America. ExxonMobil relies on technological innovation and advanced exploration techniques to lower costs and drive profits. We The company is geographically diversified with ownership interest in 37 refineries with 6. a company founded by John D.45 based on a 5 year S&P regression. Exxon and Mobil merged to create ExxonMobil. Currently headquartered in Irving. we believe XOM's corporate governance practices are sound and above average for companies within their sector. oil and natural gas exploration and production (8% of sales and 81% of earnings). The NOC’s are keeping the reserves with the lowest development costs to themselves. Earnings Drivers: ExxonMobil operates in three primary lines of business. Europe and Asia. coal and minerals. Chevron. 8%). ExxonMobil has been the world’s largest publically held corporation.0 billion barrels of oil equivalent and a strong replacement rate. Unlike rival. declined by 37% and Exxon now obtains a quarter of its production from Africa. An analyst from Bolter and Co estimates that Exxon is currently trading at a 12% premium to its peers based on next year EV/EBITDA multiples and a 16% premium to its peers based on next year P/E multiples (Seeking Alpha). industry. In 1911. In addition to oil production. Conoco Phillips. In 1999. Rockefeller in 1870. Since 2000. a Supreme Court ruling split Standard Oil into 34 separate companies. Exxon's oil output from two of its largest regions. ExxonMobil’s 21% ROE exceeds all of its competitors. 2010 Global Trends Business Description Company History: ExxonMobil is a direct descendent of Standard Oil. Corporate Finance 2 . national oil companies (NOCs). ExxonMobil is a multinational oil conglomerate. ExxonMobil continues to lead the world in profits and market value. which eventually became Exxon and Mobil respectively. the United States and Europe. Exxon is the largest refiner of oil in the world. Primary Competition: ExxonMobil’s main competitors based on its size. The chemicals business represents a shift into a new segment in an attempt at diversification. Texas. Company Size: Since 2005. Though Wal-Mart recently surpassed them in revenue. and Marathon Oil. With operations in 21 countries.ExxonMobil November 19. Managment: From Proxy Statement analysis.Equity Research Report . similar areas of operational expansion include electric power generation. and financial figures are BP. Its board of directors is controlled by a supermajority (greater than 75%) of independent outsiders and CEO Rex Tillerson has consistently delivered on shareholder expecations. Exxon also has a large Chemical division. NOC’s far and away dominate the supply of proven and probable reserves with about 80% of the world's reserves and a projected 80% of incremental production rate going forward. estimate ExxonMobil’s beta to be a stable 0. and chemicals (9%. although changes in SEC reserves classification may distort replacement data going forward. Two of those were the Standard Oil Company of New Jersey and the Standard Oil Company of New York.

operating costs. which takes historical financial metrics and devides each line item by sales.548 398. To calculate the cost of equity we used three approaches. the Capital Asset Pricing Model (CAPM). Cash reserves take years to build (the last time cash dipped below $11 billion was in 2003) so we used a very Corporate Finance 3 . and the Bond Yield + Premium Model (BYP). This discount rate will show what the cash flows are worth today. Taking the weighted average of the cost of equity and cost of debt yields the WACC. Changes in operating capital from year to year affect the net investment in operating capital. Future Cash Flow Projections: Free cash flow quantifies the residual amount of money a company has after accounting for its operations. an appropriate discount rate must be used to accurately consider the time value of money. The nonoperating assets show up on the balance sheet as well in the form of short term current assets and long term investments. the current yields of all outstanding long-term bonds are averaged to show the realisitic cost of raising funds in the debt capital markets at the time of this analysis. $55. yielding historical margins.41% 432.499 5. the arithementic average growth rate of 3.437 to $10.84 November 19.104 392. This use of cash to maintain solvency and restore stability to the company represents a structural change in the companies finances and cannot be expected to bounce back immediately. We used a weighted average cost of capital (WACC) of 8. assets.76% 8.” In both of these cases we chose to project based on individual growth rates as opposed to sales ratios. Historical average ratios do not accurately represent these two items.000 in short term assets. We used the average margin to projected out future data based on our top-line revenue growth expectation with the exception of two items which we determined would require adjusted forecasting.50% 8.000. Exxon Mobil has a large and complex Discounted Free Cash Flow Valuation. $31. Those long term assets go into the DCF sheet as a part of operating capital. To project revenues and costs that affect free cash flow. The assets-in-place that Exxon owns include such assets as oil rigs and oil refineries.41%. 8. All other inputs were projected using a sales ratio method.63% 8. We then averaged these out to find the weighted total cost of equity.373 402. taxes. 2010 Discounted Cash Flow Analysis Assets critical to ExxonMobil total firm value: As is to be expected with the largest publically traded corporation. the Dividend Growth Model (DGM). but for different reasons. plant.41% for our discount rate. and equipment (PP&E). In order for the share price to rise the investments that Exxon makes must earn a higher free cash flow in the future and a higher rate of return than the cost of capital. net investment and working capital requirements (short-term investment required to maintain opperatons).693 dropoff).000 in long-term assets vs. or non-operating.8% 9.Equity Research Report . The operating and non operating assets added together give the total assets owned by Exxon. which in turn lowers free cash flow. To find the cost of debt. First. Cash was a valuable commodity during the liquidity crisis and Exxon put more than two-thirds of their cash reserves (observable from 2008-2009.043 $77.29% was found for the previous five years at Exxon and used to project sales and proceeds from opporations for the current year and five years forward. The present value of the future free cash flows is discounted at the weighted average cost of capital because cash in the future is worth less than cash today. The corporate valuation begins by looking at the company’s assetsin-place and the financial.235. Estimating cash flows requires projecting out all of the necessary inputs to the cash flow statement and then calculating the net free cash flow to equity. The assets are expected to grow and generate free cash flows. 8.ExxonMobil DCF Summary Data Perpetual growth rate WACC Horizon value PV of Operations Adjusted TEV Implied Equity Value Shares (Millions) Estimated Share Price 1. Estimating the Cost of Capital: Cost of Equity CAPM DGM BYP Average 6. which represents XOM’s specific blend of equity cost and after-tax cost of debt. “Total Cash and Cash Equivalents” and “Net property. we used a historical average method. The balance sheet in 2009 shows $178.41%.41% After cash flows are projected. taking into account consumption preferences and riskiness.088.000.

The first step in identifying comparable companies to ExxonMobil is to identify their Standard Industrial Classification. in our case ExxonMobil. Exxon is obviously a behemoth within its own industry. The value of common stock net of debt is 392.Equity Research Report . a reasonable value for a firm is its sales. Hess Corporation. ExxonMobil was classified as part of the “petroleum refining” industry and thus given the SIC code 2911. and still is not a truly viable or prudent descision. plant and equipment was not. The eight companies chosen were Chevron Corporation. In the midst of the economic turmoil of 2008-2009.373.043 Billion shares outstanding yields an estimated value per share of $77. ConocoPhillips. or SIC.175 Billion in short-term investments and $38. Despite a massive drop in oil prices and sales revenue being cut in half.000 which was discounted at the WACC.5 Billion and dividing this by the 5. 2911 encompasses 335 companies which is obviously too large and too diverse a group to use in our multiples analysis. profit and cash flow patterns and similar required returns. As one of the largest corporations in the world.97 Billion total-long term. XOM Comps Chevron Corp Conoco Phillips Royal Dutch Shell BP Plc Hess Corp Occidental Peteroleum Valero Energy Sunoco Inc Selecting Comparable Frims: The first step in doing this is selecting appropriate companies to compare to the subject.520. We followed a similar technique for PP&E. Market Multiples Valuation Valuation Rationale: Firms within a given industry have similar sales. This historical average over the past 25 years. code The SIC code is a United States government system for classifying industries by a four-digit code. reducing net property.42%. XOM is attempting to expand its portfolio and increase total assets under control. earnings or cash flows times the respective industry ratio. and Sunoco Inc.000. Exxon has a total of $5. Deriving the XOM share price: We found the present value of operations to be $398. plant and equipment to fall dramatically in correspondence with the fall from historal sales averages. This sums to a Total Enterprice Value of $402. These companies have the highest enterprise values in their industry as well as a minimum of 10 oils rigs in a minimum of 2 countries. Valero Energy. Adding the value of non-operating assets raisings this estimate to $442. Royal Dutch Shell. We expect that PP&E will grow in line with this assumption at a rate above sales growth for the near to medium term.1 Billion after removing non-operating liabilities. only the largest companies with globally diverse operations were chosen. This does not follow rational capital budgeting theory and required adjusting the estimation calculation to use a historical growth rate of 5. As such.000. As we have seen with the XTO acquisition. BP. 2010 conservative growth rate of 0.ExxonMobil November 19.22%.84. Non-operating assets are holdings that could be liquidated at some point (either short or long term) without affecting free cash flows.000. Corporate Finance 4 . the floating-rate bank debt used to finance many of these expendutures is very affordable and major asset sales are likely to yield low profits and discourage investors. Using market multiples to value a stock produces an estimate of the stock price and firm value based on an estimate of these industry multiples. The selection of companies is important because a stronger financial analysis is obtained when comparison companies are highly similar. Therefore. With interest rates at historic lows. Occidental Petroleum. many companies were struggling to stay afloat and needed to make dramatic changes to remain solvent. initial sales ratio analysis estimated net property.

Further risk stems from the recent reaction to the Deepwater Horizon oil spill from US politions as well as the possible for expanded clean energy incentives and higher taxes on envirionmental-damaging practices. Gross Profit. For Exxon. EBITDA. 2010 The multiples used in the valuation of ExxonMobil were Sales. cash on hand was added and interest bearing debt was subtracted to find an estimated value of equity. and to create an implied firm value for each. a major upswing in global demand and oil prices could leave Exxon struggling to keep up with other Super Majors who use an average of 35% debt and will see much higher earnings flow to equity. Investment Risks Hold rating considers both moderate upside and downside risks. EBIT. they still face enormous competition from other producers globally and have a minimal 3% market share.50.042 Billion. Corporate Finance 5 . Alternatively. EBITDA. Prinicipal upside risks stem from the possibility that XTO results in higher than expected EPS accretion and manages to cut costs in ways previously not thought possible. yields an estimated value per share of $75. From this. EBITDA. EBIT.ExxonMobil Selecting appropriate multiples: November 19. despite being one of the largest publicly traded companies in the world. and were incorporated.48. This represents an 8% discount to our average estimated 12 month price target $76. Lastly is the simple fact that. Deriving a per share price: The multiples were averaged for each and multiplied by XOM’s own Sales.48 at the time of this analysis. were not available for all companies analyzed. In order to control for the variation in firm size. information on Sales. The share price of ExxonMobil’s public equity shares as reported Google Finance was $70. Gross Profit. Industry-specific valuation multiples. and exploration expenditures. square footage of rigs. The mean of those was taken to find the average implied firm value. Using publically available information found on their 10-K filings.Equity Research Report . major developments in their chemical business could lead to higher long-term profits. a multiple was created by dividing the firm’s enterprise value by each statistic. and P/E Ratio. EBIT. November 15th. Dividing this by the number of shares outstanding. we found an estimated value of $380. 2010. 5. Additionally. Some industry-specific multiples that were researched were barrels of oil in reserve. We maintain a Hold rating due to the significant uncertainty about the XTO merger impact as well as the stagnant natural gas market.6 Billion. Gross Profit. though desirable.

26 15.273 11.328 8.561 199.68 6.91 3.579 11.ExxonMobil Figure 1: Income Statement 2004 Revenues and other income Sales and misc.954 93.253 964 496 30.955 7.885 231.035 139.250 1.901 5.66 14. operating revenue Income from equity affiliates Other income Total Revenue Costs and other deductions Crude oil purchases Production Expenses Total Cost of Revenue Gross Profit Opperating Expenses SG&A Expenses Depreciation and depletion Exploration expenses Interest expense Sales-based taxes Other taxes and duties Total Opperating Costs Income before income taxes Income taxes Other Income Net income to ExxonMobil EPS (dollars) Diluted EPS (dollars) Source: ExxonMobile Investor Relations.169 249.469 400 31.402 (27.742 41.142 370.454 37.943 310.911) (776) 24.005) 40.280 3.719 106.99 3.583 4.936 34.98 Corporate Finance 6 .552 2008 459.699 477.449 135.680 2006 365.864) (1.183 377.479 (29.554 3.569 41.302) (799) 35.586 185.038 158.508 41.379 1.586 291.323 404.647) 45.554 98.833 124.753 13.767 1.203 97.849 9.735 11.822 298.500 7.081 6.027 185.917 2.225 162.241 (15.381 39.143 1.902) (1.546 29.220 8.263 40.806 33.451 673 34.000 152.181 654 30.224 23.961 1.432 (23.021 548 25.467 6.953 101.777 (15.819 212.873 12.252 4.89 14.498 31.62 14.71 14.108 67.528 212.SEC Edgar Filings November 19.119) (378) 19.219 26.976 34.70 8.905 287.890 12.819 89.074 165.Equity Research Report .76 5.397 (36.416 1.642 182.411 59.449 6.530) (1.635 2007 390. 2010 2005 358.690 71.610 7.331 5.402 10.383 173.359 2009 301.359 190.098 638 27.603 83.985 5.728 40.31 7.051) 38.

312 7.119 242.052 10.924 85.851 0 28.SEC Edgar Filings November 19.702 11.476 52.279) 111.082 46. plant and equipment Other long-term assets Total Long-term investments Total assets Liabilities and Shareholders' Equity Current liabilities Accounts payable Short-term debt Total current liabilities Non-current liabilities Long-term debt Deferred taxes liabilities Minority interest Other long-term liabilities Total non-current liabilities Total liabilities Stockholders' equity Additional paid-in capital Retained earnings Treasury stock Other Stockholder Equity Total Stockholders' equity Total liabilities and stockholders' equity Source: ExxonMobile Investor Relations.088 233.087 5.777 113.008 120.553 5.323 44.082 32.551 143.450 11.754 5.972 178.700 2.346 34.238 219.ExxonMobil Figure 2: Balance Sheet 2005 Assets Current assets Total Cash and Cash Equivalents Receivables Inventories Other current assets Total current assets Long-term investments Net property.220 20.726 4.320 4.899 4.061 7.175 55.307 6.869 35.115 1.786 228.186 208.933 228.993 208.569 228.931) 49.Equity Research Report .911 72.335 (55.244 28.335 47.235 139.025 19.282 27.052 233.671 27.744 50.536 1.148 4. 2010 2006 2007 2008 2009 28.678 65.518 (113.983 134.989 121.702 48.877 75.942 10.866 73.585 2.387) (2.762 242.484 9.693 122.680 (148.134 105.321 7.440 155.250 156.878 0 23.644 62.149 4.425 20.858 56.171 4.129 23.500 36.015 34.100 7.937 (166.007 24.015 55.646 3.089 3.383 58.844 219.771 46.410) (5.010 27.963 120.347) (1.266 121.342 107.207 (83.503 276.817 6.862 27.965 110.987 115.098) (9.477 163.323 Corporate Finance 7 .593 70.929 2.183 22.687 29.762) 113.400 49.678) 1.335 28.823 35.714 7.116 38.558 34.645 11.786 195.461) 112.842 97.314 265.

147 0 0 1.608) 1.399 (1.839) 34.822) (7.387) 0 4.416 0 1.299 49.433) (86) (44.270) (15.106 (1.768) 571 724 (22.500 11.318) 40.079 (31.286 2007 40.658 11.684) 144 4.285) 2.737 1.868 574 (15.067 (2.130 10.121) 52.250 0 124 72 1.Equity Research Report .917 731 0 459 (1.808 5.204 (3.717 (2.985 (4.714) 752 (19.491) 5.558) (7.002 (15.491) 0 1.499) (22.734) (8.995 (9.221) (7.467) (10.289) 59.289 (1.703) (8.610 12.138 (13.419) 0 0 941 (18.462) 0 3.438 (22.481) 48.183) (26.947 Corporate Finance 8 .173 (29.816) 753 (35.230) (15. and equip reductions Acquisitions. plant.867 12.910) 308 (38.462) 33.286 (15.725 (19.SEC Edgar Filings November 19. and equip Property.283) 520 (20.725 2009 19.867) 42 (36.145 (13.717 (1.002 2008 46.839) 6.561 (1.318) 0 5.387) 36.824 52.379 (63) 1.544) 1.941) (787) 10.027) (2.057) 594 (2.407 28.615 59.303) 124 (27.036 0 0 0 (2.743) (2. 2010 2006 39. plant.604) 0 756 (14.884) 49.080 (2.345) 1.ExxonMobil Figure 3: Cash Flow Statement 2005 Cash Flows From Operating Activities Net income Depreciation & amortization Investment/asset impairment charges Deferred income taxes Inventory Other working capital Other non-cash items Net earnings by operating activities Cash Flows From Investing Activities Investment in property.545 (2.253 0 (429) (434) 4.728) (19.210) 727 (427) 0 0 1. net Purchases of investments Sales/Maturities of investments Other investing activities Net cash used for investing activities Cash Flows From Financing Activities Debt issued Debt repayment Common stock issued Repurchases of treasury stock Cash dividends paid Other financing activities Net cash used for financing activities Effect of exchange rate changes Net change in cash Free Cash Flow Operating cash flow Capital expenditure Free cash flow Source: ExxonMobile Investor Relations.744) 48.438 36.478) (2.618) (2.709) 28.

Equity Research Report .84 27.497) 19.785 10.689 42.175 38.116 144.675 27.486 9.877 43.524 139.581 2009 310.537 41.868 10.862 27.833 124.969 12.593 402.981 10.148 55. plant.239 194.416) 32.719 14.221 38.066 33.445 45.081 7.177 11.698 556 29.823 35.357 28.866 10.367 46.103 3.372 2015 377.520 4.726 10.122 9.998 8.418 12.578 10.495 (26.043 $77.536 5.345 188.104 1.292 2.436 1.113 207.671 48.830 27.380 138.643 11.047 11.781 2.410) 35.457 9.129 9.972 442.645 11.017 157.451 1.434 146.137 28.551 551 29.265) 36.134 1.598 (25.499 5.026 162.500 1.213 464 25.811 5.131 29.476 7. Adacemic Analysis and Projection November 19.710 38.574 157.442 (27.413 181.748 35. and equipment Operating capital Net investment in operating capital Free cash flow Assumed perpetual growth rate WACC Horizon value FCF + Horizon value Present value of operations Add non-operating assets: Short-term investments Long-term investments Less non-operating liabilities Minority interest Other long-term liabilities Enterprise value Less interest-bearing debt: Short-term debt Long-term debt Total value of common stock Millions of shares outstanding Estimated value per share Source: SEC Edgar Filings.454 3.525 13.861) 38.376 142.844 34.427 2011 331.578 398.565) 34.513 173.780 1.636 (26.280 10.586 185.669 13.205) 36.844 (23.351 488 26.571 60.510 33.171 27.234 154.117 62.323 8.242 28.102 45.352 188.377 149.697 461.569 147.749 50.076 48.640 na na 10.398 162.797 182.582 (24.060 44.539 14.819 34.188 2013 353.091 27.021 548 25.045 26.291 9.777 191.553 50.491 200.917 2.753 14.289 10.047 27.700 62.999 26.697 11.ExxonMobil Figure 4: DCF Analysis Net Sales Cost of products sold Gross profit Operating expenses: SG&A expenses Depreciation and depletion Exploration expenses Interest expense Sales-based taxes Other taxes and duties Operating income Taxes and Other Income Net Operating Profit After Taxes Operating current assets: Total Cash and Cash Equivalents Receivables Inventories Total Current Operating Assets Total Current Operating Liabilities: Net operating working capital Net property.251 7.451 480 26.289 2014 365.953 25.755 46.055 165.440 26.373 5.319 2.407 49.144 44.586 179.017 2012 342. 2010 2010 320.117 214.50% 8.907 24.129 392.538 539 27.735 11.999 Corporate Finance 9 .104 2.548 26.966 152.256 10.41% 432.850 3.511 58.810 170.322 66.783 1.777 (15.936 34.357 11.

239 462.00 34.016 278.757 Minority 647.00 35.00 1.40 26.41 16.1x 37 208.493 573 776 Gross Profit x 8.464.980 Cash 8.191 11.00 144.840. Disclaimer: The information set forth herein has been obtained or derived from sources generally available to the public and believed by the authors to be reliable.2x 1. express or implied.054.537.774. nor is it an offer or a solicitation of an offer to buy or sell any security.4x 7.40 161.70 104.4x 9.054.41 16.272 29.99 # of Refineries 15 19 47 26 4 9 15 6 # Refineries x 11403.156.99 390.311 14.6x 5500.0 344.41 71.ExxonMobil Figure 5: Multiple Analysis Chevron Corp Conoco Phillips Royal Dutch Shell BP Plc Hess Corp Occidental Peteroleum Valero Energy Sunoco Inc Chevron Corp Conoco Phillips Royal Dutch Shell BP Plc Hess Corp Occidental Peteroleum Valero Energy Sunoco Inc Chevron Corp Conoco Phillips Royal Dutch Shell BP Plc Hess Corp Occidental Peteroleum Valero Energy Sunoco Inc Average ExxonMobil Valuation Average Implied Value Add excess cash Less interest bearing debt Estimated value of equity # shares outstanding Value per share Source: SEC Edgar Filings.6x 14.6x 13.271 28.499.537.2x 17. as to its accuracy or completeness.80 239.00 8.605 380.9x 0. Ratings guide: Banks rate companies as either a BUY.432 17.622.4x 7982. Equity 21.99 Sales 159. Receipt of compensation: Compensation of the authors of this report is not based on investment banking revenue.0x 20.2x 275. or their household members.736.135.135.927 4. The authors of this report.70 104.616.0 324.00 EBITDA 26. do not hold a financial interest in the securities of this company.788.588.6x 1115.736.20 84.384 169 9.614 15. but the authors do not make any representation or warranty.9x 8. Adacemic Analysis November 19.169. or any other relevant index.320.169. A SELL rating is given when the security is expected to deliver negative returns over the next twelve months.608.00 78.499.7x 0. and recommends that investors take a position above the security’s weight in the S&P 500.9x 4.1x 0.181 7.3x 11.304.971.322 8.40 161.230.8x 0.564.6x 16.876 (701) 77 EBIT x 11.719.2x 4.286 1.610 5. HOLD or SELL. This information does not constitute investment advice.627.467. while a HOLD rating implies flat returns over the next twelve months.796.9x 12.00 590.9x 88.843.41 71.7x 11. Corporate Finance 10 .80 239.00 500.Equity Research Report .843.00 Gross Margin 13% 9% 18% 22% 16% 42% 1% 3% Sales x 1.704. 2010 Debt 10.40 26.052.00 28.298 4. do not know of the existence of any conflicts of interest that might bias the content or publication of this report.00 825.691 MVIC 171.2x 0. The information is not intended to be used as the basis of any investment decisions by any person or entity.293 136.70 91.079 33.1x 5.5x 8.788.0x 38.77 126.7x 10.5x 5.00 1. or their household members.993 826 598 EBITDA x 6.00 562.64 22.0x 6213.00 9.8x 3.3x 9.194.00 4. or their household members.822.812 52.043 $75.7x -23.9x 4.6x 26. This report should not be considered to be a recommendation by any individual affiliated with Northeastern University with regard to this company’s stock.41 11.00 Gross profit 20.018 Equity 170.00 542.00 2.41 71.621 21.43 4. A BUY rating is given when the security is expected to deliver absolute returns of 15% or greater over the next twelve month period. directors or advisory board members of the subject company. do not serve as officers.988 429.0x 5088.00 377.00 1.653.1x 29.108 Pref.188 239.7x 0.8x 6.00 EBIT 14.804 MVIC 171.8x 1131.0x 42.594 6.033. Market making: The authors do not act as market makers in the subject company’s securities. Position as a officer or director: The authors.745 49.362.400.403 67.43 6.5x 5.392 4.43 6.00 2.2x 8.00 7.606 29.0x 6542.48 Disclosures: Ownership and material conflicts of interest: The authors of this report.

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