1. Industrials Stock Recommendation Bernard Hosanna Shawana Jackson Brett Kinkopf Jonathan Kocon Chien-Ying Lee

2. Agenda  Recap of Sector  Industrial Holdings  Stock Recommendations  Summary  Q&A

3. Sector Recap  SIM Industrials Weight: 12.76% S&P500 Industrials Weight : 10.28% Overweight by 248bps  Class agreed to increase 15bps to overweight the sector by 200bps  Positive sector developments Improving global growth Unemployment rate improving Rising GDP data Favorable industrial spending

4. Industrial Holdings Current Holdings Emerson=1.23% General Dynamics=3.57% Oshkosh=4.01% UTI Worldwide=2.38% First Solar=1.57% Total=12.76% Proposed Holdings Emerson=1.23% General Dynamics=3.00% Oshkosh=3.50% UTI Worldwide=2.38% Bucyrus=2.17% Total=12.28% Sell 57 bps of General Dynamics Sell 51 bps of Oshkosh Sell 157 bps of First Solar Buy 217 bps of Bucyrus

5. First Solar (FSLR) Overview Produces Cadmium Telluride Solar Panels and provides solar energy solution services Is attempting to attain “grid parity” or a ~$0.70/watt price of electricity Have claimed they hit $1/watt… Much lower than the $4/watt for most solar units Considered a growth stock –Has paid no dividends and has seen massive capital gains since its IPO

6. FSLR in Relation to XLI

7. FSLR Valuation Absolute Valuation HighLowMedianCurrent#Your Target Multiple *Your Target E, S, B, etc/Share Your Target Price P/Forward E218.116.044.717.7206.1122 P/S84.4011.24.5724168 P/B97.53.49.13.5530.8154 P/EBITDA633.2410.7281.3311.18209.6192 P/CF973.711.687.711.9209.0180

8. FSLR DCF and Target Price Terminal DCR of 12% Terminal FCF growth of 4.5% Target price of $148.74 Current price of $108.62 Upside of 36.9%!!! So why sell?

9. Everything Looks OK- So Why Sell? A considerable portion of FSLR’s revenue is based on purchases backed by international governmental subsidies Recently the German government announced that it would decrease its subsidies for photovoltaic panels On February 18 th, FSLR management announced it would widen its EPS guidance to $6.05 - $6.85 So the DCF may still look good, but these forecasts are much less certain now In other words- overnight the volatility of this stock increased greatly. This company is beholden to the whims of foreign governments

10. Bucyrus International Products: –Draglines –Drills –Shovels & excavators –Mining trucks Demand Drivers: –Coal –Copper –Oil sands –Iron ore –Other minerals Designs, manufactures, and markets mining equipment Supplies aftermarket parts and services for mining equipment

11. Bucyrus International NASDAQ:BUCY Stock Price:$65.82 Market Cap:$4.80b Revenue:$2.65b Diluted EPS:$4.12 Shares:74.46m Dividend Yield:0.20% Risks Commodities market Mining activity Global economy Foreign currency

12. GDP & Bucyrus

13. Crude oil spot price & Bucyrus

14. International Growth Largest surface markets: –Australia –Canada –China –India –South Africa –South America –US Expected growth in Russian and Indonesian markets Largest underground markets: –Australia –Germany –China –US Germany expected to decline as a market Expected growth in Russian, Indian, and Eastern European markets 70% of sales outside of U.S.

15. Bucyrus’s Financials

17. Bucyrus’s Key Financial Stats Low current to D/E ratio at 0.37 compared to industry at 2.63 Low PEG ratio at 1.24 compared to industry at 2.02 5-year Historical EPS Growth Rate 86.5% Low P/E ratio at 15.33 compared to industry at 27.16

18. BUCY’s Valuations

19. Absolute ValuationHighLowMedianCurrent Target Multiple Target E,S,B Price Target P/Forward E26.1417.615.7184.9388.74 P/S30.41.8 45.3181.56 P/B49.114.93.84.916.8382.47 P/EBITDA23.532.0914.498.85147.2100.8 P/CF28.23.220.112.7204.9899.6 Average Price Target = $90.63 = 38% upside

20. Joy Global’s Valuation Average Price Target = $62.52 = 11% upside

21. DCF model & Target Price =(50% ave multiples + 50% DCF) =(0.5*$90.63 + 0.5*$81.50) =$86 (30% upside) Current Share Price : $65.82 Implied equity value/share : $81.5 Upside/(Downside) to DCF : 23.8% Terminal Discount Rate:10.5% Terminal FCF Growth: 5.0%

22. What the charts suggests

23. Industry Charts

24. BUCY vs JOYG Charts over 5 yrs

25. Summary Proposed Holdings Emerson=1.23% General Dynamics=3.00% Oshkosh=3.50% UTI Worldwide=2.38% Bucyrus=2.17% Total=12.28% Sell 57 bps of General Dynamics Sell 51 bps of Oshkosh Sell 157 bps of First Solar Buy 217 bps of Bucyrus First Solar Uncertain outlook Highly volatile Germans reduces subsidies Bucyrus Rising global growth driven by emerging markets Improving Asian urbanization should drive commodity prices higher Technical charts bullish

26. BUCY Sensitivity Analysis

27. Emerson Electric Emerson is a global diversified technology company The company engages in designing and supplying product technology, as well as delivering engineering services and solutions to various industrial, commercial, and consumer markets worldwide Current Share Price : $48.49 Implied equity value/share : $54.56 Upside/(Downside) to DCF : 12.5% Terminal Discount Rate:10.5% Terminal FCF Growth: 5.0%

28. Oshkosh Industry: Trucks and Other Vehicles Market Cap: $3.3 B Target Price: $44 Current Price: $37.25 Upside Potential: 18%

29. Uti Worldwide DCF: –Current Price: $15 –Implied/Equity Value: $17 –Upside/(Downside): 10.3% Discount rate: 10% Terminal growth rate: 3.5% HighLowMedianCurrentTarget Multiple Target / Share Target Price P/E - Forward 32.9010.1019.9020.4019.900.5611.14 P/S1.200.200.600.400.603621.60 P/B6.401.403.202.003.207.8825.60 P/EBITD A 25.294.9813.9711.3213.971.3919.44 P/CF34.706.6016.6013.0016.601.2120.11 Multiples Target Price: $20 Average Target Price: $18.50

30. General Dynamics Multiple Valuation Absolute Valuation HighLowMedianCurrentTarget Multiple Target value/share Valuation Opinion P/Trailing E 19.76.515.310.212.76.4882.3 P/Forward E 1.80.61.20.81.079.431 P/B4.81.63.22.22.730.38682.042 P/S13.423.939.666.217.210.76577.508 P/CF18.25.513.98.811.357.686.26 Recommendations DCFLowHighTarget Price Current Price (04/03/2010) 72.91 Implied equity value/share 81.9577.5186.2681.73 Upside/( Downside)12.40%6.31%18.31%12.10% HOLD Price Range: $77.51-- $86.26 Target Price: 0.5* Ave of multiple valuation price + 0.5* DCF

31. General Dynamics--DCF Terminal Discount Rate =11.5% Terminal FCF Growth =4.0% Year2009E2010E2011E2012E2013E2014E2015E2016E2017E2018E2019E Revenue3198130737338993491635964366833741738165389283970740501 % Growth-3.89%10.29%3% 2% Operating Income36283802435943654495458546774771486649635063 Operating Margin11.34%12.37%12.86%12.50% Interest and Other-141-133-147-152-156-159-162-166-169-172-176 Interest % of Sales-0.441%-0.434%-0.435%-0.434% Taxes110211591331 1371139914271455148415141544 Tax Rate31.60% Net Income23742509288028822968302730883150321332773342 % Growth5.69%14.80%0.04%3.00%2.00% CFO30112920322033173417348535553626369837723848 % of Sales9.41%9.50% Subtract Capital Expense475461505520532543550561568580587 % of Sales1.49%1.50%1.49% 1.48% 1.47% 1.46% 1.45% Free Cash Flow25362459271527972884294230053065313031923260 % of Growth-3.02%10.43%3.00%3.13%2.00%2.13%2.00%2.13%2.00%2.13%