ATTENTION Advanced Investors and Finance Professionals: If

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ATTENTION Advanced Investors and Finance Professionals:

If you are reading this you should downloadValuEngine Institutional Software to see how VEs powerfulquantitative tools can increase your productivity and effectiveness.

January 25, 2010

MARKET OVERVIEW

Summary of VE Stock Universe

Stocks Undervalued 55.53%

Stocks Overvalued 44.47%

Stocks Undervalued by 20% 26.32%

Stocks Overvalued by 20% 19.81%

SECTOR OVERVIEW

Sector Change MTD YTD ValuationLast 12-MReturn

P/ERatio

Basic Industries 0.48% -2.52% -2.48% 7.54% overvalued 83.18% 25.52

Capital Goods 0.55% 0.48% 0.48% 5.48% overvalued 50.80% 22.74

Consumer Durables -0.21% -0.23% -0.23% 11.54% overvalued 81.48% 21.96

Consumer Non-Durables -0.19% -1.71% -1.74% 0.89% overvalued 68.30% 18.26

Consumer Services -0.19% -0.72% -0.72% 2.87% undervalued 70.06% 22.15

Energy 0.95% -1.60% -1.60% 12.51% overvalued 66.49% 22.19

Finance 0.66% 0.97% 0.97% 1.50% undervalued 32.23% 17.97

Health Care 0.10% -1.17% -1.17% 7.48% undervalued 57.84% 20.82

Public Utilities 0.68% -2.91% -2.91% 1.51% overvalued 38.77% 16.64

Technology -0.09% -1.18% -1.18% 6.56% undervalued 72.13% 25.78

Transportation 0.82% -1.58% -1.58% 0.61% overvalued 43.47% 20.93
http://www.valuengine.com/pub/main?i=0http://www.valuengine.com/pub/main?i=0


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Suttmeier Says--Commentary and Analysis from Chief Market Strategist RichardSuttmeier

If you have any comments or questions, send them to [email protected]

Banking

The Large Regional Banks have Hidden Bad Loans

BB&T Corp (BBT) charged off $517 million bad loans up 10.5% fromthe third quarter and non performing assets increased 7%. BB&T increased reserves forlosses by nearly $200 million to $725 million. BB&T are slightly overexposed to C&D loanswith a stuffed pipeline at 87.3%. The bank is only projected to match the market by ourmodels--"3-Engine."

BBT Valuation & Rankings

Valuation 19.17% overvalued Valuation Rank 21

1-M Forecast Return -1.20% 1-M Forecast Return Rank 38

12-M Return 44.04% Momentum Rank 55

Sharpe Ratio -0.16 Sharpe Ratio Rank 455-Y Avg Annual Return -7.15% 5-Y Avg Annual Rtn Rank 46

Volatility 43.69% Volatility Rank 66

Expected EPS Growth 15.51% EPS Growth Rank 39

Market Cap (billions) 18.96 Size Rank 97

Trailing P/E Ratio 23.36 Trailing P/E Rank 55

Forward P/E Ratio 20.23 Forward P/E Ratio Rank 28

PEG Ratio 1.51 PEG Ratio Rank 26

Price/Sales 1.79 Price/Sales Rank 41

Market/Book 1.18 Market/Book Rank 57

Beta 1.14 Beta Rank 47

Alpha 0.08 Alpha Rank 49

Huntington Bancshares (HBAN) described economic outlook as uncertain and fragile. They

set aside $894 million for its loan-loss reserve up 88% from the third quarter. HBAN isoverexposed to C&D loans with a stuffed pipeline at 81.1%. The bank is only projected tomatch the market by our models--"3-Engine."
http://www.valuengine.com/nl/mainnl?nl=C


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HBAN Valuation & Rankings

Valuation 25.90% undervalued Valuation Rank 791-M Forecast Return -1.74% 1-M Forecast Return Rank 21


Sharpe Ratio -0.40 Sharpe Ratio Rank 24

5-Y Avg Annual Return -31.94% 5-Y Avg Annual Rtn Rank 18




Trailing P/E Ratio n/a Trailing P/E Rank 6

Forward P/E Ratio n/a Forward P/E Ratio Rank n/a

PEG Ratio n/a PEG Ratio Rank n/a





SunTrust Banks (STI) described their results as continuing to be affected by recessionarypressures evidenced by soft revenue and weak loan demand from both consumer andcommercial borrowers. The bank is hard hit by home equity and mortgage lending exposuresin the struggling housing market particularly in Florida. Net charge-offs declined 18.7% to

$820.5 million and loan loss provisions declined $217 million to $973.7 million. Noncurrentloans totaled $5.4 billion. STI is not overexposed to C&D or CRE loans but their portfolio of$8.75 billion in C&D loans are 82.9% funded, which is a sign of stress. The bank is onlyprojected to match the market by our models--"3-Engine."

STI Valuation & Rankings

Valuation 7.09% overvalued Valuation Rank 34

1-M Forecast Return -2.03% 1-M Forecast Return Rank 16


Sharpe Ratio -0.31 Sharpe Ratio Rank 31

5-Y Avg Annual Return -21.51% 5-Y Avg Annual Rtn Rank 26




Trailing P/E Ratio n/a Trailing P/E Rank 19

Forward P/E Ratio n/a Forward P/E Ratio Rank n/a


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STI Valuation & Rankings

PEG Ratio n/a PEG Ratio Rank n/a





Courtesy of Google Finance

The ValuEngine Quarterly FDIC Report UPDATED

Our Chief Market Strategist Richard Suttmeier is an expert on the banking system, and hehas been closely following the banking and credit crisis for several years now. In fact, hepredicted the current difficulties YEARS before they began. Every quarter, he takes theFDIC's own Quarterly Banking profile, combines it with VE's powerful quant tools, addsadditional proprietary data from the FDIC on loan exposures, and collates the info into anexhaustive report on the state of the US banking system.

We have updated the FDIC Report to include the latest VE datapoints on all problem banksas well as Suttmeier's latest predictions for the US banking system and economy.

There are currently 759 publicly traded FDIC insured financial institutionsoverexposed to CD Loans or Nonfarm Non-Residential Real Estate loans as per the

FDIC's own guidelines.
http://www.google.com/finance?chdnp=0&chdd=0&chds=0&chdv=0&chvs=Linear&chdeh=0&chdet=1264539600000&chddm=98141&chls=IntervalBasedLine&cmpto=NASDAQ:HBAN;NYSE:STI&cmptdms=0;0&q=NYSE:BBT&ntsp=0http://www.google.com/finance?chdnp=0&chdd=0&chds=0&chdv=0&chvs=Linear&chdeh=0&chdet=1264539600000&chddm=98141&chls=IntervalBasedLine&cmpto=NASDAQ:HBAN;NYSE:STI&cmptdms=0;0&q=NYSE:BBT&ntsp=http://www.google.com/finance?chdnp=0&chdd=0&chds=0&chdv=0&chvs=Linear&chdeh=0&chdet=1264539600000&chddm=98141&chls=IntervalBasedLine&cmpto=NASDAQ:HBAN;NYSE:STI&cmptdms=0;0&q=NYSE:BBT&ntsp=0


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As of January 8, 2010, there were 221 banks overexposed to C&D and/or CRE loans in theValuEngine database with full data coverage. Of these overexposed banks, 82 were rated 1-Engine Strong Sells, 73 were rated 2-Engine Sellsall of which are predicted to underperform the markets as a whole, 63 were rated 3-Engine Holdswhich are predicted toroughly match the overall market, 3 were rated a 4-Engine Buy, and none held our highestrating of 5-Engine Strong Buywith the 4 and 5-Engine stocks predicted to out perform theoverall market.

This means thatthere are currently 155 banks rated Sell or Strong Sell that are alsooverexposed to C&D and/or CRE loans.

There are 198 overexposed institutions with only partial ValuEngine coverage and thusthose banks have no rating--these are included in the problem bank list.

There are 341additional institutions carrying C&D and/or CRE loans in excess of theFDIC guidelines that do not appear in the ValuEngine database. These are also listed in

the report following the VE List of Problem Banks.

For more on the ValuEngine Quarterly FDIC Report, Click the Image Below
http://www.valuengine.com/nl/mainnl?nl=C

ATTENTION Advanced Investors and Finance Professionals: If

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