UPS Final Presentation****

Recommendation n 85 stocks n market is currently

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Recommendation n 85% stocks n Market is currently doing well and assumed to be receiving higher returns n 15% bonds n Low interest rates offer low cash flows on bonds n Expecting significantly higher returns 85%(.111) + 15%(.0527) vs 60%(.111) + 40%(.0527) 10.2% vs 8.7%
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Top-Down Allocation Asset Mix (100%) Stocks 85% Bonds 15% Stocks Domestic 91% International 9% Bonds Investment Grade 66% Government 34% Allocation
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Industry Allocation Stocks ($85 mil) Domestic ($72 mil) Healthcare SXCI, ISRG $29 mil Technology AAPL, TXN, INTC $19 mil Motor Vehicles GM $8 mil Sports Apparel NKE $4 mil Electrical Equipment GE $4 mil Cable TV TWC $4 mil Air Transportation LUV $4 mil International ($12 mil) Sports Apparel LULU $12 mil Bonds ($15 mil) Investment Grade Kellogg, Microsoft $9.7 mil Government T-Note $5.3 mil Total $100 mil
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Bottom-Up Allocation Fundamental Lululemon Nike Adidas Under Armour Beta 2.34 1.01 N/A 1.5 P/E 62.54 23.84 19.77 53.27 EPS 1.27 4.79 2.12 1.9 ROE 36.98% 22.59% 13.46% 16.58% Quarterly Sales Growth 51.4% 15.1% 11.3% 22.9%
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Bottom-Up Allocation n Environment n Sports Endorsements n Brand Loyalty n Quality n Sponsorships n Consumer Sentiment n Legal n Pending Litigations
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Industry’s Technical Analysis
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Individual Stocks’ Week-to- Week % Returns
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