Welcome! May 16, 2011

 General Update  Investment Competition  How to pitch a stock  Stock Pitch

 Officers announced next week  Investment comp. prizes next week

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Opportunity to show your knowledge and passion for the markets

 Content – 30%  Presentation – 30 %  Q and A – 40 %

StructureContentTime Tell them what you want to tell them Your recommendation based on 3 bullet points 15 seconds Company SnapshotBrief description of the company 15 seconds Tell them what you have to say Explain those 3 bullets in detail, including valuation 120 seconds Tell them what you told them Provide a catalyst and repeat your 3 bullet points 30 seconds

Line ItemsAmount in ThousandsMargin Revenue775,443 Cost of Goods Sold364,687 Gross Income410, % SG&A374,007 Operating Income36,7494.7% Tax8,355 Net Income28,3843.7% EarningsMultiplePriceStockX=

 Great company with a cheap valuation  First two bullet points convey how “great” company is  Last convey how cheap the valuation is

 Purpose Framework of what to say Build expectation  Example Buy recommend on Avid Technology (AVID), target price of $47.00, which is a 29% upside from yesterday’s close. My recommendation is based on 3 reasons: (a) strong growth from new products (b) opportunity for margin expansion from changes in sales mix and (c) attractive valuation

 Purpose Helps place judge mentally with your stock  Ex. Avid Technology develops, market, sells & supports a wide range of software and hardware for digital media production, management and distribution. For example, one would use avid software to superimpose 2 photos. Avid had last fiscal revenue of 775 million, market cap 1.8 billion, 3 month avg. vol. 650 thousand, and 12 month P/E of 15.6x

 Purpose Provide evidence on how revenue would grow  Example AVID will continue to post strong revenue growth drive by  Broadcasters’ conversion from tape to digital  Move to HD format. Only of the top 2,500 broadcasters have transitioned from tape-based solutions 3 billion market opportunity. 80% of Avid’s 60,000 video customers are yet to upgrade to HD capabilities Average price of $35,000 for a HD system  $1.7 billion in potential sales.

 Purpose Provide evidence on how margin could improve  Example Current operating margin at 4.7% Sales mix 50/50 between software/hardware Increasing software in mix for last 2 years  Can increase to as high as 70% Increase margin to 10%  Software margins better than hardware

 Purpose Explain why the stock is undervalued  Example Company missed expectations by a penny and stock went down 25%  Overreaction Historical P/E of 23.5x  Peer group P/E of 20x 20x 2007 EPS of $2.34 = stock price of $47.00

 Purpose Reiterate your investment thesis Provide a catalyst  Example Strong revenue growth prospects from tape -> digital Opportunity for margin expansion -> sales mix Compelling valuation for gain of 29% Launch of new product DigitalPro next month will be catalyst

 Most questions will be based on what is actually said  Some questions will be based on what you deliberately did not say

 How much time did it take for 500 broadcasters to transition from tape- based solutions?  What would make those 80% HD customers to upgrade  How did you determine the $35,000 price?

 What are some risk factors?  What is the downside if those risks happen?  Why did the stock move way it did?  What is the street missing?

Neoprobe

 Buy recommend on Neoprobe  Target price of $6.50, 35% upside  Recommendation based on 3 reasons: Presentation of Phase III Lymphoseek Data NDA submission 3Q 2011 Attractive valuation

 Based out of Dublin, Ohio  Market leader in gamma detection devices (generating revenue)  On its way to be a leader in Oncology

 article= article=  The results from NEO3-09 are important not only in that they demonstrate that Lymphoseek is safe and well-tolerated but in many ways that it is a clinically superior lymphatic mapping agent to vital blue dye

 What are your questions?