© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

THE RELATIVE WEALTH CHART STRATEGICALLY THE RELATIVE WEALTH CHART STRATEGICALLY COMPARES WEALTH CREATED TO CASH COMPARES WEALTH CREATED TO CASH ECONOMIC RETURNS (CER’S) ABOVE THE ECONOMIC RETURNS (CER’S) ABOVE THE DISCOUNT RATE AND TO ASSET GROWTHDISCOUNT RATE AND TO ASSET GROWTH

© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

THE INTRINSIC VALUE CHART COMPARES PRICES THE INTRINSIC VALUE CHART COMPARES PRICES TO INTRINSIC VALUES TO DETERMINE IF THE TO INTRINSIC VALUES TO DETERMINE IF THE

FIRM IS UNDER OR OVER VALUEDFIRM IS UNDER OR OVER VALUED

Notice the large high low variation around the intrinsic valuations,

providing opportunity for profitable trading

The Absolute “Tracking” Error Intrinsic Value vs. Actual Equals the Absolute Geometric Mean Error

Between The Intrinsic Value Red Line And Closing Prices at Fiscal Year + 3 Months

(hollow circles) Over the Number of Years

© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

THE PREDICTIVE INTRINSIC VALUE CHART THE PREDICTIVE INTRINSIC VALUE CHART ESTIMATES CONVERGENCE OF ACTUAL ESTIMATES CONVERGENCE OF ACTUAL

PRICE TOWARD INTRINSIC VALUEPRICE TOWARD INTRINSIC VALUE

© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

THE COMPARATIVE INTRINSIC VALUE CHART COMPARES THE THE COMPARATIVE INTRINSIC VALUE CHART COMPARES THE TRACKING ERROR ACCURACY OF TWO MODELS TO TRACKING ERROR ACCURACY OF TWO MODELS TO

DETERMINE WHICH TO RELY ON FOR SELECTING STOCKSDETERMINE WHICH TO RELY ON FOR SELECTING STOCKS

LCRT

Residual Income

© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

THE COMPARATIVE INTRINSIC VALUE THE COMPARATIVE INTRINSIC VALUE CHART ALSO QUANTIFIES VALUE EFFECTS CHART ALSO QUANTIFIES VALUE EFFECTS

OF NON-RECURRING ITEMS WHICH MAY OF NON-RECURRING ITEMS WHICH MAY NOT BE ONE TIME EVENTSNOT BE ONE TIME EVENTS

© 2004 LifeCycle Returns, Inc. All Rights Reserved

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Sources:Financial Statements and Price

Data – CapitalIQCalculations – LCRT Platform

ADDING ANALYSTS’ SALES AND EPS ADDING ANALYSTS’ SALES AND EPS ESTIMATES ENABLES COMPARISONS OF ESTIMATES ENABLES COMPARISONS OF

PLAN VALUES FROM THE FORECASTS PLAN VALUES FROM THE FORECASTS AGAINST SPOT VALUES FROM HISTORYAGAINST SPOT VALUES FROM HISTORY