SPECIAL BRIEFING

WHAT TO BUY AFTER THE MARKET CRASHES

File Number

File Type Confidential Open Access

0 9 3 7 8 2 9 9 1 1

What to Buy After the Market Crashes

Dear Private Briefing Reader,

One of the darkest secrets investors learn about the market is that crashes are inevitable.

And, for those who are invested in the market during one, it can be a harrowing experience.

Even now, almost 30 years later, just hearing Black Monday – the name given to the largest single-day crash in history – can send shivers down the spine of veteran investors.

True, market crashes have earned the “doom and gloom” stigma they have garnered over the years. But savvy investors know that a market crash doesn’t need to instill the mind-numbing panic in the heart of investors that it’s known for.

The key is being prepared.

I’ve already shown you that the markets are headed for the same kind of financial carnage we saw back in 1987.

And to survive the next crash with your capital intact, understanding how to hedge your portfolio before the market tanks is just one piece of the puzzle.

Seasoned investors will tell you that knowing how to handle the volatility that comes after the market has already crashed is just as vital to safeguarding your finances.

Here at Private Briefing, we’ve uncovered the quintessential crash rebound strategy you need to control your financial destiny.

Better yet, we’re going to give you a shopping list of stocks that you can lean on when the next crash rocks the market.

Let’s look at them together now…

Investor’s ReportFrom: Bill Patalon, Executive EditorFor: Private Briefing Subscribers

PRIVATE BRIEFING Investor’s Report

2

Your “Saving Grace”Rookie analysts will tell you that the best thing to do after a market

crash is nothing.

Don’t sell, don’t buy, just wait out the volatility storm.

I cringe when I see novice investors following this advice.

Fact is, investors who are simply market spectators after a crash cause more harm than good. That’s because, historically, the days following a crash are the single-best days to buy stocks.

Now, hear me out – I know that might sound crazy.

But truth is, even some of the strongest, most well-managed stocks get dragged into the mud during a market crash only to then rise from the ashes when the dust settles – bringing in unheard-of gains for investors who were smart enough to grab shares at a severe discount.

It’s all part of something I call an “accumulation” strategy.

And it could be your saving grace while navigating market crashes.

Here’s how it works…

Getting StartedFirst, you need to start by identifying the companies whose business

models you like – so much, in fact, that you want to own them for the long haul – and making a list of them.

Then you start establishing initial positions in each of them – understanding that you’ll want to add to those stakes whenever there’s a sell-off… either in the broad market or in the individual shares.

And your goal is to keep this going – to maintain this strategy as part of your overall financial plan to build up wealth for your future.

You’ll need to watch each company, of course. They’ll go through economic ebbs and flows. That’s part of the business cycle, and you don’t want that to deter you.

PRIVATE BRIEFING Investor’s Report

3

The only way you’d alter your plan, of course, is when a company really falls out of bed.

I’m not talking about a major sell-off in the market – I’m talking about when there’s a structural change in the company’s business and its outlook.

If you see that coming, you’ll want to reapportion that cash into a different holding.

You also want to have enough of these companies that you’re accumulating to avoid being too narrowly focused with your capital.

You’ll want to build your own “shopping list” of stocks, of course – based on your own goals, interests, and areas of insight. If you have “specialized knowledge” about a company, a sector, or a geographic market, for instance, use that advantage when making your list.

Here’s a “starter” list I’ve put together of powerhouse firms every investor should think of grabbing at a discount.

Let’s look at them together.

Accumulate Stock No. 1: NXP Semiconductors NV (Nasdaq: NXPI)

NXP Semiconductors NV (Nasdaq: NXPI) has been on my radar for quite some time.

Netherlands-based NXP designs and manufactures high performance mixed signal semiconductor solutions, which are used in a wide range of industries, including: automotive, identification, wireless infrastructure, lighting, industrial, mobile, consumer, and computing applications.

And while NXP’s products are widely used, the main reason I’m bullish about NXP in the long-term comes down to wearable technology.

At the same time, the firm also predicted that the smart wristband segment alone will grow from 8 million in 2014 to 23 million in 2015. That number is expected to reach 45 million in 2017.

PRIVATE BRIEFING Investor’s Report

4

Another study from Juniper Research in late 2013 reported that retail revenue from the wearable technology market will grow from $1.4 billion in 2013 to $19 billion in 2018.

Currently, this wearable technology juggernaut has 552% earnings growth and a forward-looking P/E of just 13.

Since I first started researching this stock back in May 2012, it has seen peak gains of 471.2%.

Compare that to the paltry 39.1% gain for the Dow Jones Industrial Average and 44% for even the 52.6% gain in the S&P 500 over the same period, and you can see that this is a firm you want to continue to buy at a discount, because you may never see that price again as the company continues to dominate this $19 billion industry.

Accumulate Stock No. 2: Google/Alphabet Inc. (Nasdaq: GOOGL)

With over one billion users, this globally integrated technology company profits from virtually every keystroke that’s typed on a computer.

This year, the Mountain View, California-based firm was able to pass Apple Inc. (Nasdaq: AAPL) to become the world’s most valuable company. Executives reported earnings of $8.67 per share on revenue of $21.32 billion, surpassing analyst expectations for both revenue and profits.

That’s great when you consider that the best is yet to come.

I really dig what this company has been dishing out over the past few years. In addition to all the search, digital marketing, and e-commerce stuff it’s involved with, it’s Alphabet’s “other bets” like driverless cars, super-high-speed internet, artificial intelligence, and drones – all market slices with great promise – that is really turning investors heads.

There’s just one problem, they don’t appear to be profitable – yet. According to the company, “other bets” generated under $500 million in sales last year but cost the company more than $3.5 billion in losses.

PRIVATE BRIEFING Investor’s Report

5

Naturally, the analysts are shaking their heads because that’s “not the way you want to do things,” but I beg to differ.

The question, as always, is not how much these kinds of breakthrough investments cost to get off the ground, but how much they’re going to generate when customers begin using them a few years from now.

The track record is fabulous when you think about it.

For example, Gmail just passed one billion users last quarter and is the seventh Google service to hit that milestone. Google, Chrome, Search, YouTube, and Gmail ALL have over one billion active users. Google’s self-driving cars have now driven 1.3 million miles in two prototype cities.

Those are all services that would have been classified as “other bets” when the company started. Now they generate $21.2 billion a year. Smart bets like these have helped quarterly earnings growth hit 45.30% year over year.

Beyond that, this accumulate stock has already proven it has the power to climb back after a market crash.

After bottoming out around $145.93 after the 2008–2009 crash, shares in Google/Alphabet have soared nearly 420%.

In fact, we’re seeing this kind of rebound power this year as well.

While the markets have continued to tank over the past 12 months, Google/Alphabet’s stock price has continued to rise nearly 32%.

So it’s no wonder the institutional investors love this one too – with BlackRock, State Street, and J.P. Morgan together owning nearly $20 billion worth.

Accumulate Stock No. 3: AMN Healthcare Services Inc. (NYSE: AHS)

AMN Healthcare Services Inc. (AHS) is one of the top performing healthcare stocks so far this year. And there are plenty of good reasons why.

PRIVATE BRIEFING Investor’s Report

6

AHS is the go-to service for healthcare workers around the nation. If you’re looking for people in healthcare administration, human resources or physicians, lab techs or nurses, AMN Healthcare is your one-stop shop.

Now that the Affordable Care Act is the law of the land, the healthcare system has been changed forever, regardless of what the next president or Congress do.

Healthcare corporations, insurers, hospitals, and private medical practices have to adjust their models to maximize their productivity. ACA is about converting a system based on volume of care to quality of care.

The fact is many at-risk patients are kept going so they make it to recovery, which means surgery numbers stay strong, while survivability is secondary.

AHS allows these organizations to make the transition easier, increasing their flexibility in hiring. It also allows healthcare professionals the ability to explore opportunities that have come with the changes.

AMN Healthcare provides everything from temporary, locum tenens, and permanent staffing for all levels of service. This also allows more flexibility on the part of the healthcare provider – they don’t have to hire a full-time worker for a seasonal upsurge in business.

It also keeps the healthcare providers focused on delivering quality healthcare and not on human resources.

Starting in San Diego, California 31 years ago, AHS continues to acquire local and regional players across the U.S. to weave together a nationally connected service. Just this month, AMN Healthcare announced that it is in the midst of acquiring Peak Health Solutions, a Tennessee-based company that outsources healthcare documentation professionals.

By beefing up its administrative side, more hospitals and care facilities are able to keep their administrative costs as low as possible by using a flexible but quality talent pool.

PRIVATE BRIEFING Investor’s Report

7

In early May, AHS released its first quarter earnings and, as has been the case for a number of quarters now, it blew away analysts’ estimates. This time it beat expectations by 22%. Its average beat in the last four quarters of reported earnings is 23.6%.

Revenue grew 43% from the year ago quarter and 16% sequentially. Year-over-year organic growth was 28%, partially through new acquisitions that grew market share.

The point is that this is no one-quarter wonder. AHS stock is on an upward trajectory and has proven itself as a company that investors want to continue to accumulate over the long haul.

Truth is, this health care services provider is not only making money from the Aging of America, but also rising in the face of the global slow down. In fact, over the past 12 months, the company’s stock has not only risen 36%, but also is delivering 103% year-over-year quarterly earnings growth.

Since the 2008 crash, this stock has made a strong surge upward – 678% to be exact.

Accumulate Stock No. 4: Ford Motor Co. (NYSE: F)

I’ve been a “Ford Guy” all my life and have followed the company for my entire professional career.

I’ve tracked Ford as a journalist and analyst since the mid-1980s. I remember how doggedly the company attacked the quality issues that took hold in the late ‘70s and early ‘80s. I was deeply impressed when, during the depths of the 2007–2009 financial crisis, Ford rejected government assistance – the only one of the “Big Three” automakers to do so. And with its “My Ford Touch” infotainment system, the company positioned itself as a leader in the whole “connected car” realm. Not to mention its recently created Smart Mobility subsidiary that formalizes its push into “car-of-the-future” slices of the auto-manufacturing market.

PRIVATE BRIEFING Investor’s Report

8

Ford is tripling its fleet of driverless vehicles and is believed to be operating the most autonomous vehicles of any carmaker. It was the first to test driverless cars in the snow. It is ramping up a new wearable technology lab in Dearborn, Michigan. It has launched a new lease-sharing program through Ford Credit.

And it has created a new data platform to better understand driver patterns in way that can be used to reduce horrid traffic problems in cities.

Ford Smart Mobility is being positioned as a startup firm. The plan is to have it design and build its own mobility services – while also collaborating with other tech firms.

“Ford Smart Mobility and expanding into mobility services are significant growth opportunities,” said Fields, the company CEO. “Our plan is to quickly become part of the growing transportation services market, which already accounts for $5.4 trillion in annual revenue.”

In addition to the top-line boost, one expert says Ford should be able to take what it learns from this new business and use it to improve its core automaking operations for the future.

“In addition to tapping into new revenue sources, Ford is establishing a framework for all work related to future mobility that allows the rest of the company to focus intently on the day-to-day core business of vehicle manufacturing,” Michelle Krebs, senior analyst at AutoTrader.com Inc., told MLive. “Past efforts by Ford to transform to a mobility company failed because the company took its eye off its core business. Yet, the work that goes on within the new mobility subsidiary can feed back into the core business when appropriate if Ford does this right.”

Big companies are tough to change quickly. But the “Blue Oval” is pushing the envelope, being as innovative as possible and making smart choices.

Since bottoming out with the rest of the market in 2008, America’s leading Transportation Company has seen peak gains of 1,204.2%.

PRIVATE BRIEFING Investor’s Report

9

Accumulate Stock No. 5: Vuzix Corp. (Nasdaq: VUZI)

Not only did Vuzix Corp. (Nasdaq: VUZI) release the world’s first augmented-reality glasses for consumers – it also controls 41 patents for this technology, with 10 more pending.

Those patents ensure that when any company in the world uses its patented technology to create an augmented reality device, they have to pay a royalty to Vuzix.

Vuzix’s specialty iWear “smart glasses” look like wraparound sunglasses, except you can’t see directly through the lenses. Instead, small cameras centered on the outside of each lens feed continuous video through a mobile computer (say, an iPhone) to an LCD screen mounted inside each lens. So you look at the world indirectly through the two tiny cameras’ feed.

When connected to an iPhone, an iPod, or a PC, the glasses combine computer input with the live video, creating a single field of view on the LCD, where computer graphics merge with the real world. At the recent Consumer Electronics Show (CES) in Las Vegas, the company showed off the various configurations of its headset trio – iWear Wireless Video Headphones, VidWear B3000 Waveguide Sunglasses, and M3000 Monocular Waveguide Smart Glasses. This display proved that Vuzix can stand up to the “name” players in the AR/ VR industry, such as Facebook and Alphabet.

“Augmented and virtual reality are no longer concepts from science fiction movies, and we are at the forefront of bringing that technology to the world,” said CEO Paul Travers.

“Our award-winning lineup of AR/VR solutions and patented technologies reflect our extensive experience and unmatched experience in the field. Our latest M300 and M3000 Smart Glasses take enterprise wearable computing into the next generation.”

PRIVATE BRIEFING Investor’s Report

10

No paper, no tablets, no computers – a multitask procedure reduced to essentially one step. It’s a technology that will take over many of the functions of our smartphones, video game consoles, and PCs. And it will disrupt all kinds of sectors, from healthcare and logistics to architecture and retail.

Vuzix sold off with the rest of the market in the beginning of 2016, giving investors who were lucky enough to grab shares an incredible discount.

Since then, shares have climbed nearly 33%.

Accumulate Stock No. 6: TrovaGene Inc. (Nasdaq: TROV)

TrovaGene Inc. – a play on a revolutionary new medical technology called “Liquid Biopsies” – is one of my go-to biotech accumulate stocks.

The reason: Liquid Biopsies – in which blood or urine samples can identify certain cancers – offer so many advantages over their surgical counterpart.

The company hit the headlines recently after ousting its two top executives for allegedly attempting to personally capitalize on business opportunities that the TrovaGene board says belong to the company.

While conceding that development represents a “hiccup” in the near-term investment case for TrovaGene, the long-term potential for this company may actually be enhanced by that messy saga.

Indeed, in his first conference call with analysts, new CEO William Welch gave an excellent showing.

Thanks to its core technology, TrovaGene operates as two companies in one – as a small medical laboratory… and as a biotech research firm.

The company, based in San Diego, has the proprietary technology and unique tests that make it possible for oncologists to eschew

PRIVATE BRIEFING Investor’s Report

11

traditional – and invasive – surgical biopsies and instead use urine-based tests to screen for certain cancers.

But even without that, TrovaGene offers a massive upside.

And one “technical” indicator confirms my belief.

My longtime Private Briefing subscribers know I like to see either “insider buying” or buying by “knowledgeable outsiders” as “reassur-ance factors” in investments like this one. And stakes held by specialized hedge funds is an example of the “knowledgeable outsider” investments I look for.

When I first brought TrovaGene to my subscribers, one of the reasons for my “Strong Buy” call was a big stake taken by Roberto Mignone’s $2 billion Bridger Management LLC hedge fund.

At the time, we told you that Bridger had just grabbed 263,300 new shares of the stock – bringing the hedge fund’s total stake to 2.85 million shares.

Now, a year later, filings with the U.S. Securities and Exchange Commission (SEC) show that Mignone’s stake in TrovaGene has zoomed to 3.291 million shares – or 11% of the biotech’s outstanding stock. That amounts to 1.28% of Bridger’s U.S. holdings.

Analysts right now have target prices that range as high as $12 – 125% above the recent trading price. Longer term, we see an even higher possible upside.

Since the crash of 2008, TrovaGene has delivered peak gains of 489% to patient investors.

Accumulate Stock No. 7: Facebook Inc. (Nasdaq: FB)

This social media giant has had the kind of run that usually has investors asking, “Is there any upside left for me?”

The short answer is yes.

PRIVATE BRIEFING Investor’s Report

12

Facebook Inc. (Nasdaq: FB) is a must-have tech stock – in any portfolio – because the profit potential is massive.

Even after a stunning two-year gain of more than 87%, Facebook has not come close to tapping its true potential.

For a company a little over a decade old, Menlo Park, California-based Facebook has a colorful history – so colorful it was made into a movie in 2010, The Social Network.

The seeds for Facebook were sown at Harvard University in 2003, when future CEO Mark Zuckerberg and three classmates created a “hot or not”-style site called Facemash by pulling data from online dorm photo directories.

Harvard shut it down within days, but it gave Zuckerberg the idea to do a school-wide photo directory called “theFacebook.” Unfortunately, he simultaneously agreed to work on code for a similar idea called HarvardConnection with fellow students Cameron and Tyler Winklevoss.

When Zuckerberg launched thefacebook.com on February 4, 2004, the Winklevoss twins were furious. The lawsuit they filed against Zuckerberg was settled in 2008 for $65 million.

But within months of launch, Facebook received $500,000 in funding from PayPal Holdings Inc. (Nasdaq: PYPL) co-founder Peter Thiel. It expanded beyond Harvard to other Boston-area universities and by December 2004 had one million users.

Facebook expanded first to more colleges, then to high schools. In September 2006, Facebook opened registration to anyone over the age of 13.

Growth exploded, with millions of people around the world signing up. By 2010, Facebook had 500 million users. Today Facebook has over 1.59 billion monthly active users.

Meanwhile, Facebook started selling advertising to monetize all those eyeballs. In 2011, Facebook made a profit of $1 billion on revenue

PRIVATE BRIEFING Investor’s Report

13

of $3.7 billion. That success led to the May 17, 2012, IPO.

Financial success has also led to a series of splashy acquisitions,

including Instagram (2012), WhatsApp (2014), and Oculus VR (2014).

Instagram launched on the iPhone in October 2010 and slowly grew

to 5 million users by June 2011.

When Mark Zuckerberg paid $1 billion for the app in 2012, the

picture app did not generate revenue, according to Forbes. It also only

had 30 million users.

Wall Street couldn’t figure out why Zuckerberg would pay so much

money just to add a picture app to Facebook.

But this is just one example of Zuckerberg proving himself as a

visionary…

You see, Instagram pictures can be shared on Facebook. But the

32-year-old CEO turned the picture app into its own unique platform.

Instagram now has 95 million pictures shared per day.

And in a 2015 fall study by Piper Jaffray, teenagers stated

Instagram was the most important social network to them.

Zuckerberg has increased Instagram’s user base by 1,566%. But more

importantly, he’s turning Instagram into a moneymaking machine…

Facebook won’t share revenue totals for Instagram, but analysts

believe it brought in as much as $750 million in revenue in 2015.

Outside of Instagram, WhatsApp, Messenger, and Oculus VR will

generate billions of dollars for Facebook over the next several years,

ultimately pushing the stock to new heights.

This is one of those stocks that you should always be looking to

accumulate when it dips.

After falling with the rest of the market earlier this year, Facebook’s

stock has charged back nearly 28%.

PRIVATE BRIEFING Investor’s Report

14

Accumulate Stock No. 8: Johnson Controls (NYSE: JCI)

Johnson Controls Inc. (NYSE: JCI) is a major player in “smart cities,” an urban-planning vision in which infotech is used to give city residents a better and safer quality of life.

This Milwaukee-based tech firm involved with autos parts (including batteries) and building control systems recently announced its plans to merge with Tyco International PLC (NYSE: TYC), a leader in building security, lighting control and fire-prevention systems. The merger is a powerful one-two punch for “smart” technology because Tyco also targets smart cities.

When Tyco and Johnson Controls announced their merger, one of the big messages was that the combined venture would be able to eliminate $500 million in operational costs. That’s a lot of cash – much of which will flow right to the bottom line.

In addition to that, in October, Johnson Controls is scheduled to spin off its auto-parts business (not including those batteries) into a standalone company called Adient. We love spinoffs. Studies show that the shares of these newly independent firms tend to trounce the overall market – and often end up as big-premium takeover plays. When I was covering Eastman Kodak Co. (NYSE: KODK) for Gannett in the mid-1990s, the once-venerable photo giant spun its Eastman Chemical Co. (NYSE: EMN) unit off to shareholders. Over the last 10 years, the chemical company’s stock has zoomed 158% – nearly tripling the 54% gain in the S&P 500 (before including Eastman’s current 2.5% dividend payout).

Most recent U.S. spinoff deals have been “tax free” to shareholders. But the Adient spinoff won’t be. But that’s okay: Because the auto-parts business will be based in London, it will enjoy much-reduced taxes. Adient will house the world’s No. 1 maker of car seats and other auto-interior components, and last year it accounted for $20 billion in sales. With that headquarters in England and most of its operations

PRIVATE BRIEFING Investor’s Report

15

already in Europe (including Recaro in Germany), Adient will enjoy a corporate tax rate of as low as 10% – compared to the 17% rate levied against Johnson Controls in the U.S. market in its most recently finished quarter, reports The Wall Street Journal. As corporate tax consultant Robert Willens told the newspaper: “Even though there’s some tax costs [for shareholders] going on up front, they’ll easily recoup those going forward because Adient will have such a low tax rate.”

Adient and Johnson Controls both figure to be big “Convergence Economy” beneficiaries. Adient should experience a nice tailwind from the emerging “connected car” market, where converging innovations such as sensors, chips, software, graphic displays, and mobile communications are transforming autos from mere vehicles into full-fledged “devices” – all of which should promote brisk vehicle sales for years to come. And Johnson Controls itself will reap the benefits of the “smart buildings” market, a confluence of sensors, miracle materials (such as “dynamic glass”), software, and the Internet of Everything (IoE). MarketsandMarkets says the connected-car market will be worth more than $36 billion by 2020.

Johnson Controls has traditionally been a well-run firm. The merger with Tyco, the cost cuts, the spinoff of Adient and the tax savings – when combined – are very likely to deliver upside surprises.

Analysts currently have a $50 consensus target price on Johnson Controls, with a high-water estimate of $59. From its recent price of about $42, that would represent a 40% gain.

Since the crash of 2008, this tech firm has made an impressive 444% rally.

Accumulate Stock No. 9: Fleetmatics Group PLC (NYSE: FLTX)

This Dublin, Ireland-based developer and marketer of fleet-management software is a big player in e-commerce.

Let’s be honest… the term “fleet-management software” is about as appetizing as uncooked polenta.

PRIVATE BRIEFING Investor’s Report

16

But this company’s prospects are actually pretty zesty – meaning the stock has a pretty nice upside.

Fleetmatics started back in 2004, in a tiny office in Dublin – and initially focused only on its home market of Ireland and the United Kingdom.

But company leaders soon realized that the U.S. market was the place to be – and opened offices in Boston and Chicago. Now, since going public on October 4, 2012, at $17 a share, the company has expanded throughout continental Europe, Canada, Mexico, and Australia.

Fleetmatics’ flagship product is a GPS device that tracks vehicles’ fuel use and helps drivers take more efficient routes and get the maximum mileage from a tank of gas.

Fleetmatics aims its Cloud-based software at the hundreds of thousands of other companies around the world that send out drivers daily. I’m talking about all the plumbers, road crews, electricians, and cable and satellite TV installers whose vehicles you see every day.

According to Berg Insight, Fleetmatics is now the largest fleet-management product provider in the Americas. The mid-cap firm now ranks as a global leader in Cloud-based logistics and supply-chain management.

The company has already reported sequentially higher revenue results in each of the last four years, growing its top line 30.6%, 39.2%, 38.1%, and 42.7%, respectively.

But it’s just getting started.

Fleetmatics had sales of $231 million last year. But some “back-of-the-envelope” numbers that Michael ran for me (and which I’ll share in a minute) tells me this company is aiming at a potential $33 billion market.

Technically speaking, Fleetmatics operates within what’s known as the “telematics market.” Telematics is the use of technology – usually

PRIVATE BRIEFING Investor’s Report

17

in the form of GPS, software and sensors – to transmit useful data from vehicles to their operators.

That market is big – and is growing fast. According to a just-released report from ResearchandMarkets, the worldwide telematics market is growing at a compound annual growth rate (CAGR) of 18.4% – and will reach $49.12 billion by 2020.

And the fleet-management slice of that business – the part of the market that Fleetmatics is aiming at – accounts for nearly half of all that revenue.

Fleet management sounds like a humdrum business – and maybe it was before the internet revolution. But we’ve reached a point where so many big-growth markets are converging – mobile communications, Big Data, Cloud computing, sensors, software-as-a-service (SaaS), and others – that the world has become one giant digital network… and innovation is limited only be the imagination of the companies seeking to capitalize.

Fleetmatics is a great example of what that innovation can achieve. In addition to the mileage-management and route-optimization benefits, the company’s GPS device also delivers crucial help with schedules, maintenance, invoices, driver IDs and reports, and precise vehicle locations – sending the data to either the fleet’s central location or drivers’ mobile devices.

And because the company has embraced the SaaS model, it’s able to deliver the data through the vehicle GPS devices via the Cloud – a low-cost and efficient solution.

Revenue comes to the company through subscription charges – which it levies per vehicle.

As of March 31, Fleetmatics counts more than 28,000 customers around the world that operate roughly 594,000 subscriber vehicles. To give you a bit of context, that’s five times the size of the fleet (99,984) operated by United Parcel Service Inc. (NYSE: UPS).

PRIVATE BRIEFING Investor’s Report

18

Accumulate Stock No. 10: CyrusOne Inc. (Nasdaq: CONE)

A Carrollton, Texas-based firm that runs 31 specialized data centers here in the United States – and five more abroad, in key global tech hubs in Europe and Asia.

Founded back in 2001, CyrusOne has traveled a circuitous route. It spent its first nine years as a standalone, privately held venture. Then, in 2010, Cincinnati Bell Inc. (NYSE: CBB) dropped $525 million to buy CyrusOne from Abry Partners, a Boston private-equity firm that specializes in data centers. CyrusOne grew, but its parent stumbled, and in 2013 Cincinnati Bell dealt off its data-hosting business in an initial public officering.

Today, CyrusOne is holding an impressive hand. It has more than 900 clients – a quarter of whom are the heavyweights that populate the Fortune 1000. Although that roster includes a nice array of tech customers, half the company’s clients are in the financial, energy and industrial sectors. Banking has been a fruitful growth area for the firm, which is why it acquired privately held Cervalis Holdings last year.

If you look out in the marketplace, you’ll find a dozen similarly sized firms that also run data centers. These companies or units of companies serve as wholesale web traffic hubs. And they provide data storage hosting services.

But CyrusOne is a cut above its rivals. Its “menu” of offerings features advanced services like data migration – and the company is grabbing market share as a result.

This specialization is why Amazon and Microsoft – the No. 1 and No. 2 cloud-storage firms – signed on as clients. That’s a kind of “Good Housekeeping Seal of Approval” that cinches CyrusOne as the best stock play in this sector.

Our timing on CyrusOne is perfect. After a shakeout in the storage sector, demand is threatening to outstrip supply, meaning CyrusOne is

PRIVATE BRIEFING Investor’s Report

19

finding it can boost prices even as it’s experiencing top-line growth that’s averaged 26% a year since 2010.

The road ahead is even more promising: Only 20% of all corporate data has migrated to cloud centers so far, meaning there’s plenty of growth to come.

To capitalize, CyrusOne has been growing its footprint in key data hubs in places like Texas and Virginia. And it’s signing clients up for deals that average seven years – a strategy designed to smooth out the sector’s ebb-and-flow patterns of the past.

Gary Wojtaszek, CEO of CyrusOne, says his team “can more than double the size of the company in the next couple of years.”

Hefty growth usually signals big jumps in expenses. Not here. Given the unused space at the data centers it already runs, CyrusOne can grow its business by 350% – without breaking ground on any new buildings.

CyrusOne isn’t a traditional tech stock.

It’s organized – for tax purposes – as a real estate investment trust (REIT). Few firms qualify for this structure. Managing more than three million square feet of real estate, CyrusOne surely does.

By operating as a REIT, there’s no need to pay corporate income taxes, as long as 90% of annual income is sent back to investors in the form of dividends.

As a REIT, you want to focus on this firm’s funds from operations (FFO), a financial metric that tells you how much cash is available for payout as dividends. In 2015, that figure rose 25% to $2.17 a share.

Look for FFO to advance at least 15% annually over the next few years. Assuming CyrusOne’s dividend hits $3 share by next year, you could be looking at a “yield on cost” (the dividend payout as a percentage of your purchase price per share) of 6.9%.

At a recent price of $44.30, CyrusOne had a market value of $3.5 billion and a yield of 3.4%.

PRIVATE BRIEFING Investor’s Report

20

After hitting a low of $34.39 during this year’s selloff, CyrusOne has surged back nearly 50%.

I encourage you all to build your own “shopping list” of stocks – based on your own goals, interests, and areas of insight.

Your goal is to keep this going – to maintain this strategy as part of your overall financial plan to amass meaningful wealth even if the market crashes.

A decade from now, we’ll all meet in Jackson Hole – or maybe Davos – because this strategy can be just that powerful.

MMP0616-594 WEB

Copyright 2007- present, Money Map Press, 16 W. Madison Street, Baltimore, MD 21201 Phone: 888.384.8339 or 443.353.4519

All rights reserved. Money Map Press provides its members with unique opportunities to build and protect wealth, globally, under all market conditions. The executive staff, research department and editors who contribute to Money Map Press recommendations are proud of our history and reputation. We believe the advice presented to our subscribers in our published resources and at our meetings and seminars is the best and most useful avail-able to global investors today. The recommendations and analysis presented to members is for the exclusive use of members. Copying or disseminating any information published by Money Map Press, electronic or otherwise, is strictly prohibited. Members should be aware that investment markets have inherent risks and there can be no guarantee of future profits. Likewise, past performance does not assure future results. Recommendations are subject to change at any time, so members are encouraged to make regular use of the website and pay special attention to Money Map Press updates sent out via e-mail. The publishers, editors, employees or agents are not responsible for errors and/or omissions.

Privacy Notice

You and your family are entitled to review and act on any recommendations made in this document. All Money Map Press publications are protected by copyright. No part of this report may be reproduced by any means (in-cluding facsimile) or placed on any electronic medium without written permission from the publisher. Information contained herein is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. Money Map Press expressly forbids its writers from having a financial interest in any security recommended to its read-ers. All Money Map Press employees and agents must wait 24 hours after an Internet publication and 72 hours after a print publication is mailed prior to following an initial recommendation. Money Map Press does not act as a personal investment advisor, nor does it advocate the purchase or sale of any security or investment for any specific individual. Investments recommended in this publication should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company.

Money Map Press • 16 W. Madison Street • Baltimore, MD 21201 • 888.384.8339 or 443.353.4519

NOTE: Money Map Press is not a broker, dealer or licensed investment advisor. No person listed here should be considered as permitted to engage in rendering personalized investment, legal or other professional advice as an agent of Money Map Press. Money Map Press does not receive any compensation for these services. Additionally, any individual services rendered to subscribers by those mentioned are considered completely separate from and outside the scope of services offered by Money Map Press. Therefore if you choose to contact anyone listed here, such contact, as well as any resulting relationship, is strictly between you and them.

Please Note: From time to time, Money Map Press will recommend stocks or other investments that will not be included in our regular portfolios. There are certain situations where we feel a company may be an extraordinary value but may not necessarily fit within the selection guidelines of these existing portfolios. In these cases, the recommendations are speculative and should not be considered as part of Money Map Press philosophy.

Also, by the time you receive this report, there is a chance that we may have exited a recommendation previously included in our portfolio. Occasionally, this happens because we use a disciplined selling strategy with our investments, meaning that if a company’s share price falls below a certain price level, we immediately notify our subscribers to sell the stock.