Our uncertainty ratings for our qualitative analysis arelow, medium, high, very high, and extreme.×Low–margin of safety for 5-star rating is a 20% discountand for 1-star rating is 25% premium.×Medium–margin of safety for 5-star rating is a 30%discount and for 1-star rating is 35% premium.×High–margin of safety for 5-star rating is a 40% discountand for 1-star rating is 55% premium.×Very High–margin of safety for 5-star rating is a 50%discount and for 1-star rating is 75% premium.×Extreme–margin of safety for 5-star rating is a 75%discount and for 1-star rating is 300% premium.4. Market PriceThe market prices used in this analysis and noted in thereport come from exchange on which the stock is listed,which we believe is a reliable source.For more details about our methodology, please go to.Morningstar Star Rating for StocksOnce we determine the fair value estimate of a stock, wecompare it with the stock's current market price on a dailybasis, and the star rating is automatically re-calculated atthe market close on every day the market on which thestock is listed is open.Please note, there is no predefined distribution of stars.That is, the percentage of stocks that earn 5 stars canfluctuate daily, so the star ratings, in the aggregate, canserve as a gauge of the broader market's valuation. Whenthere are many 5-star stocks, the stock market as a whole ismore undervalued, in our opinion, than when very fewcompanies garner our highest rating.We expect that if our base-case assumptions are true themarket price will converge on our fair value estimate overtime, generally within three years (although it is impossibleto predict the exact time frame in which market prices mayadjust).Our star ratings are guideposts to a broad audience andindividuals must consider their own specific investmentgoals, risk tolerance, tax situation, time horizon, incomeneeds, and complete investment portfolio, among otherfactors.The Morningstar Star Ratings for stocks are defined below:QQQQQWe believe appreciation beyond a fair risk-adjusted return is highly likely over a multiyear time frame.The current market price represents an excessivelypessimistic outlook, limiting downside risk and maximizingupside potential.QQQQWe believe appreciation beyond a fair risk-adjusted return is likely.QQQIndicates our belief that investors are likely toreceive a fair risk-adjusted return (approximately cost ofequity).QQWe believe investors are likely to receive a less thanfair risk-adjusted return.QIndicates a high probability of undesirable risk-adjustedreturns from the current market price over a multiyear timeframe, based on our analysis. The market is pricing in anexcessively optimistic outlook, limiting upside potential andleaving the investor exposed to Capital loss.
