value indicator - uk main market 20130501

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    01 May 2013

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    Intellisys Intelligent Analysis Limited 01 May 2013

    www.intellisys.uk.com +44 20 3239 8994 Page 2 of 17

    Contents

    Introduction .................................................................................................................................3Value ...........................................................................................................................................4Conclusion ..................................................................................................................................4RISK WARNING Ratings and Targets ....................................................................................4How to use the report .................................................................................................................5Aerospace & Defence Over Valued .....................................................................6Automobiles & Parts Under Va lued ......................................................................6Banks Over Valued .........................................................................................6Beverages Under Valued ..................................................................................6Chemicals Under Valued ..................................................................................6Construction & Building Materials Under Valued ....................................................7Electronics & Electrical Equipment Over Valued ..................................................7Engineering & Machinery Over Valued ................................................................8Food & Drug Stores Over Valued .......................................................................8Food Producers & Processors Under Valued ........................................................8General Retail Under Valued ..............................................................................9Heath Over Valued .........................................................................................9Household Goods & Textiles Over Valued ..........................................................9Information Technology & Hardware Over Valued ...............................................9Insurance Under Valued ................................................................................... 10Leisure & Hotels Over Valued ..................................................................... 10Life Assurance Over Valued .................................................................... 10Media & Entertainment Under Valued ................................................................ 11Mining Over Valued ...................................................................................... 11Oil & Gas Under Valued ................................................................................... 11Personal Care & Household Products Over Valued .......................................... 12Pharmaceuticals & Biotechnology Over Valued ................................................ 12Real Estate Under Valued ............................................................................... 12Software & Computer Services Under Valued .................................................... 13Speciality & Other Finance Over Valued .......................................................... 13Support Services Over Valued ..................................................................... 14Telecommunication Services Over Valued ....................................................... 15Transport Under Valued ................................................................................... 15Utilities Under Valued ....................................................................................... 15DISCLAIMER ........................................................................................................................... 16RISK WARNING ...................................................................................................................... 17

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    Intellisys Intelligent Analysis Limited 01 May 2013

    www.intellisys.uk.com +44 20 3239 8994 Page 3 of 17

    Introduction

    The overriding purpose of this daily report is to provide users with a quick guide that will identify thoseshares that merit their investment attention in an increasingly time critical and information noisy tradingenvironment.

    The report is published daily and delivered to the subscribers personal email box, typically, before theofficial open of the London Stock Markets.

    Putting aside luck, Intellisys recognises that the timing and value of an investment are the two primarydrivers behind a successful portfolio performance.

    Timing

    Intellisys has invested considerably in identifying what it believes are the key factors that influenceinvestment timing. Having identified the key parameters, these have been established as rules that reflectmarket dynamics and cut through the daily investment noise.

    Through this discipline, Intellisys has removed the emotional and sentimental factors as well as the dailypressures exerted upon primary stock promoters (analysts and traders) to find stories for their investmentmeetings.

    From an analysis of a years data for 40 stocks within Intellisys stock coverage, the trading indicatorsappear to be, on average, about 77% accurate in identifying good trading points as well as some 74%accurate for overall trend correlation.

    The following chart provides an indication the accuracy scores for each of the 40 stocks analysed.

    Individual Stock Rating & Trend Accuracy Scores

    Source: Intellisys

    20.0%

    30.0%

    40.0%

    50.0%

    60.0%

    70.0%

    80.0%

    90.0%

    100.0%

    110.0%

    120.0%

    1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40

    20.0%

    30.0%

    40.0%

    50.0%

    60.0%

    70.0%

    80.0%

    90.0%

    100.0%

    110.0%

    120.0%

    Best Buy/Sell Trend

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    Intellisys Intelligent Analysis Limited 01 May 2013

    www.intellisys.uk.com +44 20 3239 8994 Page 4 of 17

    Value

    A similar discipline has been applied to the process of establishing Target Indications. On a daily basis,Intellisys analyses as broad an array of historic data from not only the Consolidated Income Statement butalso the Balance Sheet and Cash Flow Statement and then utilises this data within its proprietary valuation

    models.

    Intellisys architect, Philip Morrish, has successfully applied these disciplines to his investment research forthe last 15+ years. Additionally, these investment valuation techniques lend themselves to accurate cross-border analysis.

    The resultant Target is also discounted to a Net Present Value to make the Target as realistically valid aspossible.

    Nevertheless, Intellisys recognises that Target Indication delivery is not only a function of market levels buta management teams ability to establish and maintain a value generating operating environment setagainst a constantly changing global background.

    The typical investment analysts approach to determining target prices is to start with a modest range ofsome 6 8 valuation measures and remove those that are not providing the intuitive result. Intellysisapproach is the opposite we use as many valuation methodologies as possible.

    Further, Intellisys recognises that some target Indications may appear strange or extreme. However,subscribers should not dismiss these outcomes but use them as starting points to challenge theirestablished or perceived valuation opinion of a stock.

    In short, this disciplined approach provides an investment reality check to assist investors from falling inlove with a stock or becoming mesmerised by management cults.

    Conclusion

    No investment methodology is 100% successful and like all trading and investment systems active positionmonitoring is critical for maximised investment performance.

    Therefore, Intellisys recommends that its products should be used in conjunction with, and not separatefrom subscribers existing investment systems as well as discussing investment options with their financialadvisers.

    Philip Morrish (philip.morrish@intellisys.uk.com)

    RISK WARNING Ratings and Targets

    Intellisys does not make personal recommendations. The information in this publication is provided solely toenable you to make your own investment decisions. If you are unsure about dealing in shares and otherequity investments, you should contact your financial adviser as these types of investments may not besuitable for everyone. The value of stocks and shares, and the income from them, can fall as well as riseand you may not get back the full amount you originally invested. If denominated in a foreign currency,fluctuations in the exchange rate will also affect the value of stocks and shares and the income from them.Past performance is not necessarily a guide to future performance.

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    Intellisys Intelligent Analysis Limited 01 May 2013

    www.intellisys.uk.com +44 20 3239 8994 Page 5 of 17

    How to use the report

    This daily report is typically available for download as a PDF from 7am - well in advance of the marketsopen - and is based upon previous days closing prices.

    We have kept the rep