Credit Sussieresearch Weekly

09/04/2013Research Weekly

Positive view onrisky assets not injeopardy

Disney, Home Depot, JPMor-gan, Masco, Mylan, Procter &Gamble, Time Warner and VisaUS stocks with strong momentumin terms of price, liquidity andCFROI.

Buy

Tactical views

Companies back in focusas Q1 2013 earningsseason gets under waypage 3

Tactical views

Credit spreads aretightening again page 3

Tactical views

Fed minutes andEurogroup meeting infocus page 2

Tactical views

Nikkei 225 Index with animpressively strongtechnical picture page 4

Tactical views

EUR/USD: Still positive dueto supportive technicalspage 4

Tactical views

Gold – staying neutralas long as USD1520/1500 holdspage 4

Important disclosures are found in the Disclosure appendix. Credit Suisse does and seeks to do business with companiescovered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could af-fect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.For a discussion of the risks of investing in the securities mentioned in this report, please refer to the following Internet link:https://research.credit-suisse.com/riskdisclosure

Global ResearchPrivate Banking

ZurichInvestment horizon: 1-6 months

Tactical views

Positive view onrisky assets not injeopardy

Olivier P. Mü[email protected], +41 44 333 01 46

Michael [email protected], +852 3407 8268

Thomas [email protected], +41 44 333 50 62

The correction in the financial markets late last week, particu-larly following the release of disappointing US labor market da-ta on Friday afternoon, was not entirely unexpected: we haverepeatedly flagged in recent publications that mild correctionsin an uptrend are to be expected, and to some extent, fairlyhealthy. Meanwhile, our central view remains that the uptrendin risky assets, particularly equities, is not greatly endangered,especially as underlying money flows into the asset class provesupportive as we detail in our equity contribution, and interestrates are likely to remain low.

Tensions on the Korean peninsula are escalating, althoughthe impact on global financial markets has thus far been limit-ed. The KOSPI has dropped about 4% since the beginning ofApril to 1,920.7, while the KRW is softer at 1,139 against theUSD, from 1,115 at the start of the month. North Korea’s sud-den halt of activity at the Kaesong Industrial Complex, a sym-bolic joint venture with South Korea, made headline news. Inour view, Kim Jong-un’s increasing political rhetoric is intend-ed to show North Korea’s opposition to the sanctions imposedby the UN Security Council on 7 March. The timing also coin-cides with several key political anniversaries of the Kim regimeto be held throughout the month of April, including the first an-niversary of Kim’s appointment as the First Secretary of theWorkers’ Party of North Korea on 11 April 2012. However,our base case remains that an outright conflict is very unlikelyas a de-stabilizing regime serves no interest to those involved,while North Korea is still in need of foreign aid and a normal-ized international relationship. We expect the KOSPI to stayrange-bound between 1,800 and 2,000 in the near term andunderperform against the MSCI Asia Pacific due to continued

fund outflows, weak technicals, negative earnings momentumand geopolitical concerns. We maintain our 12-month KOSPItarget of 2,150.

In this week’s edition of Research Weekly, we introducetwo new equity trades. Fundamentally, we recommend invest-ing in US equities, which exhibit positive momentum as per ourHOLT screening methodology. Furthermore, we highlight thatUS retailer Macy’s and US REIT Simon Property appear attrac-tive from a technical perspective. In addition to these two con-tributions, we are reiterating our cautious view on gold, andour technical analyst features the Nikkei–225, a market whichhas benefited from the recent weakening of the JPY againstmajor currencies. (09/04/2013)

Global Risk Appetite Indicator and MSCI World

-8

-6

-4

-2

0

2

4

6

8

Jan 88 Jan 92 Jan 96 Jan 00 Jan 04 Jan 08 Jan 12

50

100

150

200

250

300

350

400

450

Daily Risk Appetite MSCI World (rhs)

Euphoria

Panic

Rebased Index (Jan 1988 = 100)

Source: Credit Suisse, Datastream, Credit Suisse / IDC

Fed minutes and Eurogroupmeeting in focusBjörn [email protected], +41 44 333 57 43

Last week’s US labor market report took the markets clearlyby surprise with its disappointing headline figure for new non-farm payrolls. However, it is too early to draw any conclusionsfrom just one number, particularly as the data could be proneto substantial revisions later on. Furthermore, while not overlybuoyant, most other US data have been improving (consumerconfidence, regional PMI), and this week’s releases of retailsales (March) and consumer confidence (April) are expectedroughly unchanged compared to the preceding month. Theminutes of the Fed’s March meeting may provide additional in-sight into discussions regarding the pace of asset purchases.While there is still a risk of the negative impact of the fiscal se-quester showing up in the economic data over the comingmonths, it would likely cause the Fed to delay any slowdown inthe pace of its asset purchases.

Other important economic events this week include the re-lease of February industrial production data for the Eurozoneas well as the Eurogroup meeting on Friday. German industrialproduction surprised to the upside in February following adownward revision of the January estimate, and may also im-

2 Tactical views 09/04/2013 Credit Suisse - Research Weekly

pact Eurozone industrial production. The Eurogroup meetingon Friday will likely discuss the bailout package for Cyprus,and have to decide on a maturity extension of loans to Portu-gal, as well as the release of a EUR 2.8 bn payment toGreece, which has been delayed thus far.

The tensions between North and South Korea have beenmaking headlines as we highlight in the introduction. While on-ly a very rough proxy of China’s influence over North Korea, bi-lateral trade between the two countries has been rising steadi-ly in recent years, with Chinese customs reporting exportsworth USD 3.4 bn and imports of USD 2.5 bn for 2012. Asmuch of the exports are likely energy and food, Chinese ex-port bans could have a substantial effect on North Korea.

(09/04/2013)

Credit spreads are tighteningagainMaurice [email protected], +41 44 333 21 41

Weakness in economic data continued to support longer-datedglobal benchmark bonds. The US non-farm payrolls readingwas significantly weaker than we had expected, recording anincrease of 88K (consensus 190K). Furthermore, commentsfrom ECB President Mario Draghi were fairly dovish, and heraised the possibility of further non-standard measures to espe-cially address Eurozone peripheral credit conditions in the bank-ing sector. Credit spreads closed last week stable (with re-spect to cash bonds) to somewhat tighter (referring to creditderivatives) amid clearly weaker equity markets, with both se-nior and subordinated financial paper outperforming. After sev-eral weeks of softness, European high yield instruments re-bounded with a total return of 0.5%, outpacing the return of0.2% for the US market. Banking and financial sector bondsled the European rally, following earlier pressure related toCyprus. Emerging market USD sovereign bonds posted strongreturns over the week as spreads tightened considerably, point-ing to a potential reversal of their underperformance YTD.

This week, it will be interesting to see whether benchmarkyields will continue to be driven by potentially exaggerated pes-simism or turn direction to follow the credit markets. US eco-nomic data releases will continue to be very important, in partic-ular retail sales data and how consumer confidence has recent-ly been affected by the labor market weakness. Additionally,the FOMC minutes could provide some important insights intothe Fed’s assessment at its last monetary policy meeting. Wemaintain a neutral view on the global government bond marketin the 7–10Y segment. From a tactical perspective, we favorgovernment bonds in AUD and USD over EUR and JPY. Wereinstated our tactical overweight for high yield and hard cur-rency emerging market bonds against government bonds (re-spectively government-related in EUR) in our CS fixed incomemodel portfolios as we consider the credit spread wideningwhich started in late January as offering an opportunity amidmuted volatilities and abating political risks.

(09/04/2013)

Companies back in focus asQ1 2013 earnings seasongets under wayOlivier P. Mü[email protected], +41 44 333 01 46

In the near term, the equities markets will be focusing on Q12013 earnings releases, which started on Monday in the USAwith Alcoa reporting after the close of trading; European com-panies typically commence reporting with a slight time lag. For2013, global aggregated earnings expectations stand at 9.8%for 2013, led by emerging markets far east and Japan, andwell supported by the US. Furthermore, Europe is still likely tocontribute positively to global earnings growth, and we notethat global aggregated earnings revisions have already bot-tomed. While the results for Q1 2013 are unlikely to provideany fundamentally new insights, as Q4 2012 earnings werepublished just a few weeks ago, together with the outlookstatements, they are likely to boost confidence that expecta-tions for 2013 earnings can indeed be met. Moreover, the re-leases will likely confirm whether, to what extent, and especial-ly where the economic recovery is translating into revenuegrowth. While our Investment Committee has a positive viewon global equities tactically (1–6 months), we think the ongo-ing political uncertainties (Southern European banks) and gov-ernment formation in Italy are likely to lead to modest correc-tions near term. All the same, as we highlighted last week, wewould expect any correction to be limited, as money flows intothe asset class are likely to prove supportive.

(09/04/2013)

Aggregated earnings revisions for MSCI World

-0.8

-0.6

-0.4

-0.2

0

0.2

0.4

Jan 88 Jan 92 Jan 96 Jan 00 Jan 04 Jan 08 Jan 12

200

300

400

500

600

700

800

900

1'000

1'100

1'200

MSCI World Revision Ratio MSCI World Index (rhs) 4M-Moving Average of Earnings Revisions

Source: IBES Datastream, Credit Suisse


Gold – staying neutral as longas USD 1520/1500 holdsKarim [email protected], +41 44 334 56 39

Gold fell amid strong selling pressure last week before recover-ing to the mid-USD 1570s after disappointing US employmentdata. The recent price action in the market, however, wasstrong enough to trigger a technical momentum downgrade tonegative. And, with the lack of investment interest still being akey drag on the market, there is now a risk of a shift lower to-ward USD 1520 and possibly USD 1500. USD 1520/00 is acritical technical area that needs to hold for the sideways trendto remain intact. A drop below that level would have negativeconsequences for our still overall neutral view. The substantialunwinding of speculative long positions to levels last seen inlate 2008 would suggest, however, that much of the downsideis already priced in. Nonetheless, with implied volatility still hov-ering at low levels, we would recommend considering put op-tions – which are still fairly attractively valued – to protectagainst potential weakness (Please also see: Research Alert,“Gold derivatives – a gauge of gold market expectations” of03/04/2013). (09/04/2013)

EUR/USD: Still positive dueto supportive technicalsMarcus HettingerHead of Global Forex [email protected], +41 44 333 13 63

Although the ECB has left the door open for easing,EUR/USD recovered by the end of last week and still tradesabove the key support level of 1.27. While risks of a moderatedecline are not over, we note that EUR/CHF is approachingthe minimum exchange rate of EUR/CHF 1.20 imposed bythe SNB. We think the risk-reward trade-off is attractive at cur-rent spot levels to position for a higher EUR/CHF through op-tions. We thus recommend a bullish risk reversal at zero cost,i.e. selling a EUR put/CHF call at 1.2080 and buying a EURcall/CHF put at 1.2350 (indicative at time of writing). We ex-pect the SNB to defend the floor with utmost determination,and anticipate that an easing of the EUR risk premium wouldsee a resumption of capital outflows out of Switzerland. CHFremains overvalued and we expect EUR/CHF at 1.25 in threemonths. (09/04/2013)

Nikkei 225 Index with animpressively strong technicalpicturePascal [email protected], +41 44 333 24 59

In the Research Weekly publication of 08/01/2013, we high-lighted that the Japanese Nikkei 225 Index had confirmed along-term technical base. Since then, the index has rallied ap-proximately 25 percent, and the indicated double-bottom rever-sal pattern proved to be a valid turnaround signal for the long-term trend. Currently, the index is hovering close to 14000and heading toward the 61.8% Fibonacci resistance. Themedium-term momentum (shaded indicator in the lower half ofthe chart) is in a topping process, whereas the long-term mo-mentum remains in a solid uptrend. The current momentumreadings show that the index is likely to enter a short- or evenmedium-term consolidation close to the 14000 resistance lev-el.

However, the trend indicators of the index remain clearlypositive and suggest that it can be expected to rise further,once the medium-term momentum starts bottoming. The medi-um-term momentum bottom scenario is expected to lastaround 2–6 weeks. We reiterate our positive view on theNikkei 225 Index on a strategic and tactical investment hori-zon, and we recommend investors remain overweight in globalequities as an asset class. (09/04/2013)

Nikkei 225 IndexWeekly bar chart with medium- and long-term technical indica-tors

2007 2008 2009 2010 2011 2012 2013

-4000

-3000

-2000

-1000

0

1000

2000

3000

7000

8000

9000

10000

11000

12000

13000

14000

15000

16000

17000

1800019000

0.0%

23.6%

38.2%

50.0%

61.8%

100.0%

Source: MetaStock, Reuters


Equity trade recommendations

US stocks withstrong momentum

Olivier P. Mü[email protected], +41 44 333 01 46

Disney, Home Depot, JPMorgan, Masco, Mylan,Procter & Gamble, Time Warner and VisaUS stocks with strong momentum in terms of price,liquidity and CFROI.

Buy

In this edition of Research Weekly, we feature US stockswhich, according to our HOLT methodology, exhibit positivemomentum in terms of price, CFROI and liquidity. The stockswhich passed our screen are listed below. In addition, all of thestocks have a BUY recommendation, which indicates that theirvaluation upside potential is intact. Moreover, with the start ofthe Q1 2013 earnings season this week, our selection ofstocks is likely to benefit from additional near-term catalysts.Indeed, the US market, which we have been recommendingas an overweight for a while now, generally exhibits strong mo-mentum and currently trades at an all-time high, although earn-ings are around 30% higher and of better quality than was thecase when the previous high was reached in 2007.

(09/04/2013)

Please also see: “US equities: Monetary policy and macro recovery re-main supportive”Research Alert, published 3 April 2013

Home DepotAndreas [email protected], +41 44 333 37 39

Home Depot, the world’s largest home improvement chain,generates almost 90% of its revenues (2013E) in the US. Inour view, Home Depot is well positioned to benefit from im-

proving consumer confidence and a potential increase in hous-ing activities. Hence, news flow concerning US housing mar-kets will be an important short-term catalyst. In addition, thecompany is developing its mobile offerings, with applicationsaimed at developing stronger customer relationships. Conse-quently, we believe that the company’s strong business execu-tion, combined with an improving housing market, provides fur-ther upside potential for its stock price. (09/04/2013)

JPMorganChristine [email protected], +41 44 334 56 43

We believe the company has a strong position in a structurallychallenged sector. JPMorgan’s balance sheet strength, conser-vative reserves for loan losses and strong earnings power pointtoward rising future dividends and buybacks. Medium-termmarket pressure is forcing the entire industry to achieve tightercapital ratios ahead of time. This and the difficult macro envi-ronment are reducing the capital efficiency of JPMorgan andof its peers. Nevertheless, we view the company as well posi-tioned and think it could gain market share due to international-ization and consolidation efforts. JP Morgan is scheduled to re-port Q1 2013 results as of 12 April. A further significant rev-enue improvement, especially in its investment banking divi-sion, is expected to offset further net interest margin pressure.

(09/04/2013)

MascoBenno [email protected], +41 44 333 52 81

MascoMasco’s revenues (with its cabinet, insulation, door and win-dow businesses) are directly linked to the housing starts trajec-tory in the US, which we believe to be on a solid long-term up-trend. Due to the company’s leveraged operations, we expectmargins to expand significantly in the coming years. Manage-ment aims to reduce major cost blocks to become a leanerand more efficient company. Business consolidations, plant clo-sures, headcount reductions and IT systems implementations,while increasing revenues, should lead to a strong improve-ment in profit in 2013 and beyond. (09/04/2013)

5 Equity trade recommendations 09/04/2013 Credit Suisse - Research Weekly

Procter & GambleOlivier P. Mü[email protected], +41 44 333 01 46

Procter & Gamble is the world’s largest diversified large-caphousehold & personal care products manufacturer, withstrong, well-known brands and large market shares in majorcategories. We think the investments the company has madein advertising & promotion in the past few years have been suc-cessful, also in Europe. This has helped the company toachieve a turnaround, and will likely support further marketshare gains. The company is scheduled to report Q1 2013earnings on 24 April 2013, which should provide a near-termcatalyst. (09/04/2013)

MylanThomas Claudio [email protected], +41 44 334 88 38

Mylan is the fourth-largest generics manufacturer in the worldand has continuously improved its geographical footprint overthe past few years through acquisitions. The acquisition of Agi-la, a manufacturer of injectable generics, further enhances thecompany’s geographical reach (especially in Brazil) and addsanother growth platform. In our view, the company’s valuationis undemanding in view of its growth prospects, and the recentshare price correction offers an attractive entry level.

(09/04/2013)

Time WarnerUlrich [email protected], +41 44 334 56 49

Time Warner is increasing its focus on content development tofortify its long-term strategic position. The company continuesto focus on international expansion, and is undergoing transi-tions in its businesses to adapt to the structural changes in theindustry and new trends in consumer behavior to enhance itsgrowth profile. Further, we continue to like the company’slong-term potential on account of its increasing exposure tothe high-margin digital business. (09/04/2013)

VisaChristine [email protected], +41 44 334 56 43

Visa allows investors to participate in the structural growth ofthe global payment industry, especially credit (+9.2% YoY in2012). We think the percentage of payments in cash (about

30%) could decline further, which could mean additional rev-enue for Visa. Additionally, the business model is very convinc-ing: 1) economies of scale support the operating margin, 2)there are virtually no credit risks in everyday business in normalday-to-day operations, and 3) the firm is taking advantage ofvolume growth in the Asian and Latin American markets. Webelieve the stock offers solid earnings visibility, which is also in-dicated in its FY 2013 guidance. Further, the key volume andtransaction metrics continue to be strong. Also, buyback activi-ty should support the stock price. We view the targeted EPSgrowth of nearly 20% as very supportive.

(09/04/2013)

Walt DisneyUlrich [email protected], +41 44 334 56 49

Walt Disney’s diversified business model (exposure to themeparks) secludes it from the secular issues facing the traditionalmedia industry. Disney remains exposed to consumer spend-ing, and as such, the economic environment, evident in thecompany’s volatile advertising revenue, theme park visits andbox office hits. Disney’s acquisitions have strengthened itsbrands and franchise portfolio, giving the company leverage todeliver high quality products and services to customers.

(09/04/2013)


Reopening Consumer, SwissEUR/CHF beneficiaries,MultinationalsOlivier P. Mü[email protected], +41 44 333 01 46

All our trades were closed on their take profit targets last weekgiven the gyrations in the financial markets, especially follow-ing the disappointing US labor market data. In addition to ourtrade recommendation on “US stocks with strong price mo-mentum,” we are reopening our “Consumer/CAGE,” “SwissEUR/CHF beneficiaries” and “Multinationals” trade, each witha stop loss level of –2%. (09/04/2013)

New Equity Trade Recommendation

Market cap(in USDbn)

Div Yield2013E

DPS2013E

P/E2014E

P/E2013E

EPS2014E

EPS2013E

Tar-getprice

Lastprice

CurrencyRec.ISINCompany

104.12.1%1.517.120.04.103.5076.0070.06USDBUYUS4370761029HOME DEPOT

183.42.7%1.38.48.75.705.5055.0047.91USDBUYUS46625H1005JPMORGAN CHASE & CO

6.92.1%0.417.927.51.080.7023.0019.28USDBUYUS5745991068MASCO CORP

11.30.0%-8.59.83.372.9133.0028.63USDBUYUS6285301072MYLAN

213.72.8%2.217.418.84.504.1781.0078.23USDBUYUS7427181091PROCTER & GAMBLE

54.12.1%1.213.415.54.313.7460.0057.88USDBUYUS8873173038TIME WARNER

109.90.7%1.219.922.58.377.39175.00166.29USDBUYUS92826C8394VISA

104.21.4%0.815.016.83.863.4361.0057.70USDBUYUS2546871060WALT DISNEY

For a recap of open and closed trade recommendations, please refer to your Relationship Manager

Source: Bloomberg, Credit Suisse

Closed Equity Trades

Total returnClose dateOpen dateActionCompaniesTrade rationale

3.5%09.04.201319.02.2013Closed on take profit 3.5%Aryzta, Caterpillar, Holcim, Linde, Lindt & Spruengli, Master-card, Next, Partners Group, Reckitt Benckiser, T Rowe Price

Seasonality

6.5%09.04.201326.02.2013Closed on take profit 6.5%Diageo, Henkel, Coca-Cola, Nestle, Philip MorrisConsumer/CAGE

0.1%09.04.201305.03.2013Closed on take profit 0.1%Anadarko, BG Group, Eni, Galp Energia, Halliburton, RoyalDutch Shell

Energy

2.5%09.04.201319.03.2013Closed on take profit 2.5%AbbVie, Galenica, Novartis, Roche, Sanofi, Stada, TevaHealthcare withpipeline

-1.0%09.04.201326.03.2013Closed on stop loss -1.0%Clariant, Dufry, EFG International, Georg Fischer, Holcim,Lindt & Spruengli, Lonza, Partners Group, Schindler, Strau-mann, Zurich

Swiss EUR/CHF ben-eficiaries

0.1%09.04.201326.03.2013Closed on take profit 0.1%BMW, Burberry, Colgate, Hikma, Coca-Cola, PPR, SABMiller,Unilever

Multinationals

-3.0%09.04.201326.03.2013Closed on stop loss -3.0%Armstrong World Ind., Home Depot, Lafarge, Masco, OwensCorning, Simon Property, Toll Brothers

US real estate

For a recap of open and closed trade recommendations, please consult your Relationship Manager

Source: Bloomberg, Credit Suisse


Technical research trade recommendations

Medium-termtechnical buysignals triggered

Christian [email protected], +41 44 333 20 69

Macy’s, Simon Property GroupMedium-term technical buy signals have been trig-gered.

Buy

Macy’sMacy’s broke out from its large triangle pattern and surpassedthe highs of March 2013. The moving averages in all time hori-zons are rising and signal further strength. In addition, both theshort- and medium-term momentum indicators (lower half ofthe chart) are bottoming and should also be constructive. Re-sistances are at around 44 and 46.5/47; supports are at 42and 40/40.5. We recommend investors buy Macy’s from atechnical standpoint.

Macy’sDaily bar chart with short- and medium-term technical indica-tors

2012 Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2013 Feb Mar Apr

-150

-100

-50

50

100

150

200

250

x10

30

35

40

45


Simon Property GroupSimon Property Group crossed the resistance level at 164 andtriggered a clear buy signal. Short-term momentum is still ris-ing and medium-term momentum (both in the lower half of thechart) could build a new bottom above the zero line. Resis-tances can be found at 175/176 and further at 182/184. Thenext supports are at around 163 and 156/157. We recom-mend investors buy Simon Property Group from a technicalstandpoint. (09/04/2013)

Simon Property GroupDaily bar chart with short- and medium-term technical indica-tors

Apr May Jun Jul Aug Sep Oct Nov Dec 2013 Feb Mar Apr

-500

0

500

1000

1500

125

130

135

140

145

150

155

160

165

170


New technical trade recommendations

Stop-lossLast priceCurrencyRec.ISINCompany

41.743.99USDBUYUS55616P1049Macy's

162.5169.1USDBUYUS8288061091Simon Property Group

For a recap of open and closed trade recommendations, please consult your Relationship manager

Source: Reuters, Credit Suisse

8 Technical research trade recommendations 09/04/2013 Credit Suisse - Research Weekly

Important information on derivatives

Option premiums and prices mentioned are indicative only. Option premiums and prices can be subject to very rapid changes:The prices and premiums mentioned are as of the time indicated in the text and might have changed substantially in the mean-time.

Pricing

Derivatives are complex instruments and are intended for sale only to investors who are capable of understanding and assumingall the risks involved. Investors must be aware that adding option positions to an existing portfolio may change the characteristicsand behavior of that portfolio substantially. A portfolio’s sensitivity to certain market moves can be heavily impacted by the lever-age effect of options.

Risks

Investors who buy call options risk the loss of the entire premium paid if the underlying security trades below the strike price at ex-piration.

Buying calls

Investors who buy put options risk loss of the entire premium paid if the underlying security finishes above the strike price at expi-ration.

Buying puts

Investors who sell calls commit themselves to sell the underlying for the strike price, even if the market price of the underlying issubstantially higher. Investors who sell covered calls (own the underlying security and sell a call) risk limiting their upside to thestrike price plus the upfront premium received and may have their security called away if the security price exceeds the strikeprice of the short call. Additionally, the investor has full downside participation that is only partially offset by the premium receivedupfront. If investors are forced to sell the underlying they might be subject to taxing. Investors shorting naked calls (i.e. sellingcalls but without holding the underlying security) risk unlimited losses of security price less strike price.

Selling calls

Put sellers commit to buying the underlying security at the strike price in the event the security falls below the strike price. Themaximum loss is the full strike price less the premium received for selling the put.

Selling puts

Investors who buy call spreads (buy a call and sell a call with a higher strike) risk the loss of the entire premium paid if the under-lying trades below the lower strike price at expiration. The maximum gain from buying call spreads is the difference between thestrike prices, less the upfront premium paid.

Buying call spreads

Selling naked call spreads (sell a call and buy a farther out-of-the-money call with no underlying security position): Investors risk amaximum loss of the difference between the long call strike and the short call strike, less the upfront premium taken in, if theunderlying security finishes above the long call strike at expiration. The maximum gain is the upfront premium taken in, if the se-curity finishes below the short call strike at expiration.

Selling naked call spreads

Investors who buy put spreads (buy a put and sell a put with a lower strike price) also have a maximum loss of the upfront premi-um paid. The maximum gain from buying put spreads is the difference between the strike prices, less the upfront premium paid.

Buying put spreads

Buying strangles (buy put and buy call): The maximum loss is the entire premium paid for both options, if the underlying trades be-tween the put strike and the call strike at expiration.

Buying strangles

Investors who are long a security and short a strangle or straddle risk capping their upside in the security to the strike price of thecall that is sold plus the upfront premium received. Additionally, if the security trades below the strike price of the short put, in-vestors risk losing the difference between the strike price and the security price (less the value of the premium received) on theshort put and will also experience losses in the security position if they owns shares. The maximum potential loss is the full valueof the strike price (less the value of the premium received) plus losses on the long security position. Investors who are shortnaked strangles or straddles have unlimited potential loss since, if the security trades above the call strike price, investors risk los-ing the difference between the strike price and the security price (less the value of the premium received) on the short call. In ad-dition, they are obligated to buy the security at the put strike price (less upfront premium received) if the security finishes belowthe put strike price at expiration.

Selling strangles or straddles

Source: Credit Suisse

9 Technical research trade recommendations 09/04/2013 Credit Suisse - Research Weekly

Risk disclaimerInvestors should consider this report as only a single factor inmaking their investment decision. For a discussion of the risksof investing in the securities mentioned in this report, please re-fer to the following Internet link:

https://research.credit-suisse.com/riskdisclosureCS may not have taken any steps to ensure that the securitiesreferred to in this report are suitable for any particular investor.CS will not treat recipients as its customers by virtue of their re-ceiving the report. The investments or services contained or re-ferred to in this report may not be suitable for you and it is rec-ommended that you consult an independent investment advi-sor if you are in doubt about such investments or investmentservices. Nothing in this report constitutes investment, legal,accounting or tax advice or a representation that any invest-ment or strategy is suitable or appropriate to your individual cir-cumstances or otherwise constitutes a personal recommenda-tion to you.

The price, value of and income from any of the securitiesor financial instruments mentioned in this report can fall as wellas rise. The value of securities and financial instruments is sub-ject to exchange rate fluctuation that may have a positive or ad-verse effect on the price or income of such securities or finan-cial instruments. Investors in securities such as ADR’s, the val-ues of which are influenced by currency volatility, effectively as-

sume this risk. Structured securities are complex instruments,typically involve a high degree of risk and are intended for saleonly to sophisticated investors who are capable of understand-ing and assuming the risks involved. The market value of anystructured security may be affected by changes in economic, fi-nancial and political factors (including, but not limited to, spotand forward interest and exchange rates), time to maturity,market conditions and volatility, and the credit quality of any is-suer or reference issuer. Any investor interested in purchasinga structured product should conduct their own investigationand analysis of the product and consult with their own profes-sional advisers as to the risks involved in making such a pur-chase.

Some investments discussed in this report have a high lev-el of volatility. High volatility investments may experience sud-den and large falls in their value causing losses when that in-vestment is realized. Those losses may equal your original in-vestment. Indeed, in the case of some investments the poten-tial losses may exceed the amount of initial investment, in suchcircumstances you may be required to pay more money to sup-port those losses. Income yields from investments may fluctu-ate and, in consequence, initial capital paid to make the invest-ment may be used as part of that income yield. Some invest-ments may not be readily realizable and it may be difficult tosell or realize those investments, similarly it may prove difficultfor you to obtain reliable information about the value, or risks,to which such an investment is exposed.

10 09/04/2013 Credit Suisse - Research Weekly

Disclosure Appendix

Analyst certification

The analysts identified in this report hereby certify that views about thecompanies and their securities discussed in this report accurately reflecttheir personal views about all of the subject companies and securities. Theanalysts also certify that no part of their compensation was, is, or will be di-rectly or indirectly related to the specific recommendation(s) or view(s) inthis report.

Knowledge Process Outsourcing (KPO) Analysts mentioned in this reportare employed by Credit Suisse Business Analytics (India) Private Limited.

Important disclosures

Credit Suisse policy is to publish research reports, as it deems appropri-ate, based on developments with the subject company, the sector or themarket that may have a material impact on the research views or opinionsstated herein. Credit Suisse policy is only to publish investment researchthat is impartial, independent, clear, fair and not misleading.The Credit Suisse Code of Conduct to which all employees are obliged toadhere, is accessible via the website at:https://www.credit-suisse.com/governance/doc/code_of_conduct_en.pdf

For more detail, please refer to the information on independence of finan-cial research, which can be found at:https://www.credit-suisse.com/legal/pb_research/independence_en.pdf

The analyst(s) responsible for preparing this research report received com-pensation that is based upon various factors including Credit Suisse's totalrevenues, a portion of which is generated by Credit Suisse InvestmentBanking business.

Equity rating history as of (09/04/2013)

DateRatingCompany

06/02/2013BUYABBVIE INC (ABBV US)

11/02/2013BUYANADARKO PETROLEUM(APC US)

22/11/2012BUY

03/08/2012BUY

08/05/2012BUY

28/02/2012BUY

04/03/2013BUYARMSTRONG WORLD IN-DUSTRIES (AWI US)

02/04/2013BUYARYZTA (ARYN SW)

12/03/2013BUY

22/02/2013BUY

03/12/2012BUY

24/09/2012BUY

14/03/2012BUY

07/02/2013BUYBG GROUP (BG/ LN)

02/11/2012BUY

27/07/2012BUY

07/05/2012BUY

16/02/2012BUY

15/03/2013BUYBMW (BMW GY)

07/11/2012BUY

03/08/2012BUY

04/05/2012BUY

15/03/2012BUY

24/01/2013BUYBURBERRY GROUP (BR-BY LN)

12/11/2012BUY

11/09/2012BUY

12/07/2012BUY

28/05/2012BUY

DateRatingCompany

26/04/2012BUY

09/03/2012HOLD

13/02/2013BUYCATERPILLAR INC (CATUS)

21/01/2013BUY

24/10/2012BUY

26/09/2012BUY

27/07/2012BUY

30/04/2012BUY

30/01/2012BUY

18/02/2013BUYCLARIANT (CLN VX)

02/11/2012BUY

21/08/2012BUY

17/05/2012BUY

16/02/2012BUY

13/02/2013BUYCOCA-COLA (KO US)

17/10/2012BUY

15/08/2012BUY

18/07/2012BUY

18/04/2012BUY

08/02/2012BUY

31/01/2013BUYCOLGATE-PALMOLIVE(CL US)

26/10/2012BUY

27/07/2012BUY

27/04/2012BUY

01/02/2012BUY

31/01/2013BUYDIAGEO (DGE LN)

18/10/2012BUY

24/08/2012BUY

13/07/2012BUY

07/05/2012HOLD

09/02/2012HOLD

18/03/2013BUYDUFRY (DUFN SW)

23/11/2012BUY

20/09/2012RESTRICTED

30/07/2012BUY

08/06/2012BUY

04/05/2012BUY

15/03/2012BUY

27/02/2013BUYEFG INTERNATIONAL(EFGN SW)

20/12/2012BUY


25/07/2012BUY

10/04/2012HOLD

21/10/2011HOLD

20/02/2013BUYENI (ENI IM)

30/10/2012BUY

06/08/2012BUY

13/07/2012BUY

02/05/2012HOLD

21/02/2012HOLD

14/03/2013BUYGALENICA (GALN SW)

23/11/2012BUY

28/08/2012BUY

15/03/2012BUY

13/02/2013BUYGALP ENERGIA SGPSS.A. (GALP PL)

30/10/2012BUY

31/07/2012BUY

04/05/2012BUY

21/03/2012BUY

05/03/2013BUYGEORG FISCHER (FI/NSW)

23/07/2012BUY


DateRatingCompany

01/03/2012BUY

28/01/2013BUYHALLIBURTON (HAL US)

18/10/2012BUY

24/07/2012BUY

20/04/2012BUY

25/01/2012BUY

12/03/2013HOLDHENKEL PREFERRED(HEN3 GY)

16/11/2012BUY

06/09/2012BUY

01/08/2012BUY

14/05/2012BUY

02/04/2012BUY

04/03/2013BUYHIKMA PHARMACEUTI-CALS (HIK LN)

02/11/2012BUY

28/08/2012BUY

20/03/2012BUY

04/03/2013HOLDHOLCIM (HOLN VX)

08/11/2012BUY

16/08/2012BUY

25/05/2012HOLD

09/05/2012HOLD

29/02/2012HOLD

27/02/2013BUYHOME DEPOT (HD US)

14/11/2012BUY

27/08/2012BUY

14/08/2012BUY

16/05/2012BUY

23/02/2012BUY

17/01/2013BUYJPMORGAN CHASE & CO(JPM US)

09/11/2012BUY

15/10/2012BUY

16/07/2012BUY

07/06/2012HOLD

11/05/2012HOLD

13/04/2012BUY

16/01/2012BUY

21/02/2013BUYLAFARGE (LG FP)

12/11/2012HOLD

30/07/2012HOLD

14/06/2012HOLD

04/05/2012HOLD

17/02/2012HOLD

21/03/2013HOLDLINDE AKTIENGE-SELLSCHAFT (LIN GY)

02/11/2012BUY

02/08/2012BUY

06/07/2012BUY

17/05/2012BUY

13/03/2012BUY

15/03/2013BUYLINDT & SPRUENGLI PC(LISP SW)

15/01/2013BUY

21/08/2012BUY

08/03/2012BUY

25/01/2013BUYLONZA (LONN VX)

10/01/2013BUY

02/11/2012BUY

19/09/2012BUY

27/07/2012HOLD

17/05/2012HOLD

30/01/2012HOLD

22/02/2013BUYMASCO CORP (MAS US)

22/02/2013BUY

DateRatingCompany

06/02/2013BUYMASTERCARD (MA US)

04/02/2013BUY

02/11/2012BUY

02/08/2012BUY

04/05/2012BUY

03/02/2012BUY

01/03/2013BUYMYLAN (MYL US)

26/10/2012BUY

15/08/2012BUY

27/02/2012BUY

02/04/2013BUYNESTLE (NESN VX)

14/02/2013BUY

18/10/2012BUY

09/08/2012BUY

24/04/2012BUY

20/04/2012BUY

24/02/2012BUY

22/03/2013BUYNEXT (NXT LN)

03/01/2013BUY

02/11/2012HOLD

17/09/2012HOLD

16/08/2012HOLD

01/08/2012BUY

31/05/2012BUY

02/05/2012HOLD

23/03/2012HOLD

24/01/2013BUYNOVARTIS (NOVN VX)

26/10/2012HOLD

20/07/2012HOLD

25/04/2012HOLD

30/01/2012HOLD

05/03/2013BUYOWENS CORNING (OCUS)

26/03/2013BUYPARTNERSGROUPHOLD-ING (PGHN SW)

04/12/2012BUY


04/09/2012BUY

24/07/2012BUY

04/04/2012BUY

14/02/2013BUYPHILIP MORRIS INTERNA-TIONAL (PM US)

19/10/2012BUY

20/07/2012BUY

20/04/2012BUY

16/03/2012BUY

15/02/2013BUYPPR (PP FP)

08/08/2012BUY

22/02/2012BUY

30/01/2013BUYPRICE (T. ROWE) GROUP(TROW US)

06/12/2012BUY

28/01/2009TERMINATED

06/03/2013BUYPROCTER & GAMBLE (PGUS)

25/01/2013BUY

25/10/2012BUY

03/08/2012BUY

21/06/2012BUY

30/04/2012BUY

30/01/2012BUY

13/02/2013BUYRECKITT BENCKISER(RB/ LN)

16/11/2012BUY

24/10/2012BUY

30/07/2012BUY


DateRatingCompany

02/05/2012BUY

08/02/2012BUY

31/01/2013BUYROCHE (GENUSSS-CHEINE) (ROG VX)

19/10/2012BUY

30/07/2012BUY

13/04/2012BUY

12/04/2012BUY

02/02/2012BUY

01/02/2013BUYROYAL DUTCH SHELL-A(RDSA NA)

02/11/2012BUY

27/07/2012BUY

27/04/2012BUY

06/02/2012BUY

23/01/2013BUYSABMILLER (SAB LN)

22/11/2012BUY

18/10/2012BUY

30/07/2012BUY

28/05/2012BUY

19/04/2012BUY

09/02/2012BUY

11/02/2013BUYSANOFI (SAN FP)

26/10/2012BUY

17/08/2012BUY

04/05/2012BUY

15/02/2012BUY

22/02/2013BUYSCHINDLER PC (SCHPVX)

24/10/2012BUY

14/08/2012BUY

23/04/2012BUY

22/02/2012BUY

13/02/2013BUYSIMON PROPERTYGROUP INC (SPG US)

02/11/2012BUY

30/07/2012HOLD

11/06/2012HOLD

21/02/2011TERMINATED

01/03/2013BUYSTADA ARZNEIMITTEL(SAZ GR)

12/11/2012BUY

28/08/2012BUY

03/04/2012BUY

22/02/2013BUYSTRAUMANN (STMN SW)

17/01/2013BUY

17/01/2013BUY

01/11/2012HOLD

23/08/2012HOLD

27/04/2012HOLD

24/02/2012HOLD

11/02/2013BUYTEVA (ADR) (TEVA US)

05/11/2012BUY

13/08/2012BUY

05/06/2012BUY

16/02/2012BUY

08/03/2013BUYTIME WARNER (TWX US)

12/02/2013BUY

09/11/2012BUY

06/08/2012BUY

08/05/2012HOLD

10/02/2012BUY

28/02/2013BUYTOLL BROTHERS INC(TOL US)

13/02/2013BUY

23/01/2013BUYUNILEVER (UNA NA)

DateRatingCompany

04/01/2013BUY

21/12/2012BUY

20/12/2012BUY

25/10/2012HOLD

26/07/2012HOLD

27/04/2012HOLD

02/02/2012HOLD

13/02/2013BUYVISA (V US)

02/11/2012BUY

27/07/2012BUY

04/05/2012BUY

09/02/2012BUY

11/02/2013BUYWALT DISNEY (DIS US)

09/11/2012BUY

08/08/2012BUY

20/07/2012BUY

09/05/2012BUY

10/02/2012BUY

15/02/2013BUYZURICH INSURANCEGROUP LTD (ZURN VX)

17/12/2012BUY

15/11/2012BUY

17/08/2012BUY

10/05/2012BUY

16/02/2012BUY

Fundamental and/or long-term research reports are not regularly pro-duced for (HOLCIM, LAFARGE). The Global Research department re-serves the right to terminate coverage at short notice. Please contact yourRelationship Manager for the specific risks of investing in securities ofthese companies. The subject issuer (ANADARKO PETROLEUM, ARYZ-TA, BG GROUP, BMW, BURBERRY GROUP, CATERPILLAR INC,CLARIANT, COCA-COLA, COLGATE-PALMOLIVE, DIAGEO, DUFRY,EFG INTERNATIONAL, ENI, GEORG FISCHER, HALLIBURTON,HENKEL PREFERRED, HOLCIM, HOME DEPOT, JPMORGAN CHASE& CO, LAFARGE, LINDE AKTIENGESELLSCHAFT, LINDT & SPRU-ENGLI PC, LONZA, MASTERCARD, MYLAN, NESTLE, NOVARTIS,PARTNERS GROUP HOLDING, PHILIP MORRIS INTERNATIONAL,PPR, PRICE (T. ROWE) GROUP, PROCTER & GAMBLE, ROCHE(GENUSSSCHEINE), ROYAL DUTCH SHELL-A, SABMILLER,SCHINDLER PC, SIMON PROPERTY GROUP INC, TEVA (ADR), TIMEWARNER, TOLL BROTHERS INC, WALT DISNEY, ZURICH INSUR-ANCE GROUP LTD) currently is, or was during the 12-month period pre-ceding the date of distribution of this report, a client of Credit Suisse. Cred-it Suisse provided investment banking services to the subject company(ANADARKO PETROLEUM, ARYZTA, BG GROUP, BMW, BURBERRYGROUP, CATERPILLAR INC, CLARIANT, COCA-COLA, DIAGEO,DUFRY, EFG INTERNATIONAL, ENI, GEORG FISCHER, HALLIBUR-TON, HENKEL PREFERRED, HOLCIM, HOME DEPOT, JPMORGANCHASE & CO, LAFARGE, LINDE AKTIENGESELLSCHAFT, LINDT &SPRUENGLI PC, LONZA, MYLAN, NESTLE, NOVARTIS, PARTNERSGROUP HOLDING, PHILIP MORRIS INTERNATIONAL, PPR, PROC-TER & GAMBLE, ROCHE (GENUSSSCHEINE), SABMILLER, SIMONPROPERTY GROUP INC, TEVA (ADR), TIME WARNER, WALT DIS-NEY, ZURICH INSURANCE GROUP LTD) within the past 12 months.Credit Suisse provided non-investment banking services, which may in-clude Sales and Trading services, to the subject issuer (ANADARKOPETROLEUM, BMW, CLARIANT, COCA-COLA, COLGATE-PALMO-LIVE, DIAGEO, EFG INTERNATIONAL, ENI, HALLIBURTON, HOLCIM,HOME DEPOT, JPMORGAN CHASE & CO, LAFARGE, LONZA, MAS-TERCARD, NESTLE, NOVARTIS, PARTNERS GROUP HOLDING,PHILIP MORRIS INTERNATIONAL, PRICE (T. ROWE) GROUP, PROC-TER & GAMBLE, ROCHE (GENUSSSCHEINE), ROYAL DUTCHSHELL-A, SCHINDLER PC, SIMON PROPERTY GROUP INC, TEVA(ADR), TOLL BROTHERS INC, WALT DISNEY, ZURICH INSURANCEGROUP LTD) within the past 12 months. Credit Suisse has managed orco-managed a public offering of securities for the subject issuer(ANADARKO PETROLEUM, ARYZTA, BMW, CLARIANT, COCA-COLA,COLGATE-PALMOLIVE, DIAGEO, DUFRY, ENI, GEORG FISCHER,


HALLIBURTON, HOLCIM, HOME DEPOT, JPMORGAN CHASE & CO,LONZA, MYLAN, NESTLE, NOVARTIS, PARTNERS GROUP HOLD-ING, PHILIP MORRIS INTERNATIONAL, PROCTER & GAMBLE,SANOFI, SCHINDLER PC, SIMON PROPERTY GROUP INC, TEVA(ADR), TIME WARNER, WALT DISNEY, ZURICH INSURANCE GROUPLTD) within the past three years. Credit Suisse has managed or co-man-aged a public offering of securities for the subject issuer (ARYZTA, BMW,CLARIANT, COCA-COLA, DIAGEO, DUFRY, ENI, HOLCIM, HOME DE-POT, JPMORGAN CHASE & CO, LONZA, NESTLE, NOVARTIS, PART-NERS GROUP HOLDING, PHILIP MORRIS INTERNATIONAL, PROC-TER & GAMBLE, TIME WARNER, WALT DISNEY, ZURICH INSUR-ANCE GROUP LTD) within the past 12 months. Credit Suisse has re-ceived investment banking related compensation from the subject issuer(ANADARKO PETROLEUM, ARYZTA, BMW, CLARIANT, COCA-COLA,DIAGEO, DUFRY, ENI, HALLIBURTON, HOLCIM, HOME DEPOT, JP-MORGAN CHASE & CO, LINDT & SPRUENGLI PC, LONZA, MYLAN,NESTLE, NOVARTIS, PARTNERS GROUP HOLDING, PHILIP MORRISINTERNATIONAL, PROCTER & GAMBLE, SIMON PROPERTY GROUPINC, TEVA (ADR), TIME WARNER, WALT DISNEY, ZURICH INSUR-ANCE GROUP LTD) within the past 12 months. Credit Suisse has re-ceived compensation for products and services other than investmentbanking services from the subject issuer (ANADARKO PETROLEUM,BMW, CLARIANT, COCA-COLA, COLGATE-PALMOLIVE, DIAGEO,EFG INTERNATIONAL, ENI, HALLIBURTON, HOLCIM, HOME DEPOT,JPMORGAN CHASE & CO, LAFARGE, LONZA, NESTLE, NOVARTIS,PARTNERS GROUP HOLDING, PHILIP MORRIS INTERNATIONAL,PRICE (T. ROWE) GROUP, PROCTER & GAMBLE, ROCHE (GENUSSS-CHEINE), ROYAL DUTCH SHELL-A, SCHINDLER PC, TEVA (ADR),TOLL BROTHERS INC, WALT DISNEY, ZURICH INSURANCE GROUPLTD) within the past 12 months. Credit Suisse expects to receive or in-tends to seek investment banking related compensation from the subjectissuer (ABBVIE INC, ANADARKO PETROLEUM, ARMSTRONG WORLDINDUSTRIES, ARYZTA, BG GROUP, BMW, BURBERRY GROUP,CATERPILLAR INC, CLARIANT, COCA-COLA, COLGATE-PALMOLIVE,DIAGEO, DUFRY, EFG INTERNATIONAL, ENI, GEORG FISCHER, HAL-LIBURTON, HENKEL PREFERRED, HOLCIM, HOME DEPOT, JPMOR-GAN CHASE & CO, LAFARGE, LINDE AKTIENGESELLSCHAFT,LINDT & SPRUENGLI PC, LONZA, MASCO CORP, MYLAN, NESTLE,NOVARTIS, PARTNERS GROUP HOLDING, PHILIP MORRIS INTERNA-TIONAL, PPR, PRICE (T. ROWE) GROUP, PROCTER & GAMBLE,ROCHE (GENUSSSCHEINE), SABMILLER, SIMON PROPERTYGROUP INC, STADA ARZNEIMITTEL, TEVA (ADR), TIME WARNER,TOLL BROTHERS INC, WALT DISNEY, ZURICH INSURANCE GROUPLTD) within the next three months. As at the date of this report, Credit Su-isse acts as a market maker or liquidity provider in the securities of the sub-ject issuer (ABBVIE INC, ANADARKO PETROLEUM, ARMSTRONGWORLD INDUSTRIES, CATERPILLAR INC, COCA-COLA, COLGATE-PALMOLIVE, HALLIBURTON, HOME DEPOT, JPMORGAN CHASE &CO, MASCO CORP, MYLAN, NOVARTIS, OWENS CORNING, PHILIPMORRIS INTERNATIONAL, PRICE (T. ROWE) GROUP, PROCTER &GAMBLE, SIMON PROPERTY GROUP INC, TEVA (ADR), TIME WARN-ER, TOLL BROTHERS INC, VISA, WALT DISNEY). Credit Suisse holdsa trading position in the subject issuer (ABBVIE INC, ANADARKOPETROLEUM, ARMSTRONG WORLD INDUSTRIES, ARYZTA, BGGROUP, BMW, BURBERRY GROUP, CATERPILLAR INC, CLARIANT,COCA-COLA, COLGATE-PALMOLIVE, DIAGEO, DUFRY, EFG INTER-NATIONAL, ENI, GALENICA, GALP ENERGIA SGPS S.A., GEORG FIS-CHER, HALLIBURTON, HENKEL PREFERRED, HIKMA PHARMACEU-TICALS, HOLCIM, HOME DEPOT, JPMORGAN CHASE & CO, LA-FARGE, LINDE AKTIENGESELLSCHAFT, LINDT & SPRUENGLI PC,LONZA, MASCO CORP, MASTERCARD, MYLAN, NESTLE, NEXT, NO-VARTIS, OWENS CORNING, PARTNERS GROUP HOLDING, PHILIPMORRIS INTERNATIONAL, PPR, PRICE (T. ROWE) GROUP, PROCTER& GAMBLE, RECKITT BENCKISER, ROCHE (GENUSSSCHEINE), ROY-AL DUTCH SHELL-A, SABMILLER, SANOFI, SCHINDLER PC, SIMONPROPERTY GROUP INC, STADA ARZNEIMITTEL, STRAUMANN, TEVA(ADR), TIME WARNER, TOLL BROTHERS INC, UNILEVER, VISA,WALT DISNEY, ZURICH INSURANCE GROUP LTD). As at the end ofthe preceding month, Credit Suisse beneficially owned 1% or more of aclass of common equity securities of (ARYZTA, BG GROUP, BURBERRYGROUP, CLARIANT, DIAGEO, DUFRY, GALENICA, GEORG FISCHER,

HOLCIM, LINDT & SPRUENGLI PC, LONZA, NESTLE, NEXT, NOVAR-TIS, PARTNERS GROUP HOLDING, ROYAL DUTCH SHELL-A, SAB-MILLER, STRAUMANN, ZURICH INSURANCE GROUP LTD).

Additional disclosures for the following jurisdictions

United Kingdom: For fixed income disclosure information for clients ofCredit Suisse (UK) Limited and Credit Suisse Securities (Europe) Limited,please call +41 44 333 33 99.For further information, including disclosures with respect to any other is-suers, please refer to the Credit Suisse Global Research Disclosure siteat:https://www.credit-suisse.com/disclosure

Guide to analysis

Equity rating allocation as of (09/04/2013)

Investment bankinginterests onlyOverall

40.94 %40.26 %BUY

50.59 %52.08 %HOLD

5.91 %5.43 %SELL

2.56 %2.24 %RESTRICTED

Relative stock performance

At the stock level, the selection takes into account the relative attractive-ness of individual shares versus the sector, market position, growthprospects, balance-sheet structure and valuation. The sector and countryrecommendations are "overweight," "neutral", and "underweight" and areassigned according to relative performance against the respective regionaland global benchmark indices.

Absolute stock performance

The stock recommendations are BUY, HOLD and SELL and are depen-dent on the expected absolute performance of the individual stocks, gener-ally on a 6-12 months horizon based on the following criteria:

10% or greater increase in absoluteshare price

BUY

variation between -10% and +10% inabsolute share price

HOLD

10% or more decrease in absoluteshare price

SELL

In certain circumstances, internal and ex-ternal regulations exclude certain typesof communications, including e.g. an in-vestment recommendation during thecourse of Credit Suisse engagement inan investment banking transaction.

RESTRICTED

Research coverage has been concluded.TERMINATED

Absolute bond performance

The bond recommendations are based fundamentally on forecasts for totalreturns versus the respective benchmark on a 3-6 month horizon and aredefined as follows:

Expectation that the bond issue will out-perform its specified benchmark

BUY

Expectation that the bond issue will per-form in line with the specified bench-mark

HOLD

Expectation that the bond issue willunderperform its specified benchmark

SELL


In certain circumstances, internal and ex-ternal regulations exclude certain typesof communications, including e.g. an in-vestment recommendation during thecourse of Credit Suisse engagement inan investment banking transaction.

RESTRICTED

Credit Suisse HOLT

With respect to the analysis in this report based on the HOLT(tm) method-ology, Credit Suisse certifies that (1) the views expressed in this report ac-curately reflect the HOLT methodology and (2) no part of the Firm's com-pensation was, is, or will be directly related to the specific views disclosedin this report. The Credit Suisse HOLT methodology does not assign rat-ings to a security. It is an analytical tool that involves use of a set of propri-etary quantitative algorithms and warranted value calculations, collectivelycalled the Credit Suisse HOLT valuation model, that are consistently ap-plied to all the companies included in its database. Third-party data (includ-ing consensus earnings estimates) are systematically translated into a num-ber of default variables and incorporated into the algorithms available inthe Credit Suisse HOLT valuation model. The source financial statement,pricing, and earnings data provided by outside data vendors are subject toquality control and may also be adjusted to more closely measure theunderlying economics of firm performance. These adjustments provide con-sistency when analyzing a single company across time, or analyzing multi-ple companies across industries or national borders. The default scenariothat is produced by the Credit Suisse HOLT valuation model establishesthe baseline valuation for a security, and a user then may adjust the de-fault variables to produce alternative scenarios, any of which could occur.The Credit Suisse HOLT methodology does not assign a price target to asecurity. The default scenario that is produced by the Credit Suisse HOLTvaluation model establishes a warranted price for a security, and as thethird-party data are updated, the warranted price may also change. The de-fault variables may also be adjusted to produce alternative warrantedprices, any of which could occur. Additional information about the CreditSuisse HOLT methodology is available on request.CFROI(r), CFROE, HOLT, HOLTfolio, HOLTSelect, HS60, HS40, Value-Search, AggreGator, Signal Flag and "Powered by HOLT" are trademarksor registered trademarks of Credit Suisse or its affiliates in the UnitedStates and other countries. HOLT is a corporate performance and valua-tion advisory service of Credit Suisse.

For technical research

Where recommendation tables are mentioned in the report, "Close" is thelatest closing price quoted on the exchange. "MT" denotes the rating forthe medium-term trend (3-6 months outlook). "ST" denotes the short-termtrend (3-6 weeks outlook). The ratings are "+" for a positive outlook (pricelikely to rise), "0" for neutral (no big price changes expected) and "-" for anegative outlook (price likely to fall). Outperform in the column "Rel perf"denotes the expected performance of the stocks relative to the bench-mark. The "Comment" column includes the latest advice from the analyst.In the column "Recom" the date is listed when the stock was recommend-ed for purchase (opening purchase). "P&L" gives the profit or loss that hasaccrued since the purchase recommendation was given.For a short introduction to technical analysis, please refer to TechnicalAnalysis Explained at:https://www.credit-suisse.com/legal/pb_research/technical_tutorial_en.pdf

Global disclaimer / important information

For a discussion of the risks of investing in the securities mentioned in thisreport, please refer to the following Internet link:https://research.credit-suisse.com/riskdisclosure

References in this report to Credit Suisse include subsidiaries and affili-ates. For more information on our structure, please use the following link:

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Giles KeatingHead of Research for Private Banking and Wealth Management+41 44 332 22 [email protected]

Oliver AdlerHead Economic Research+41 44 333 09 [email protected]

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Olivier P. Müller+41 44 333 01 [email protected]

Michael Mak+852 3407 [email protected]

Thomas Herrmann+41 44 333 50 [email protected]

Björn Eberhardt+41 44 333 57 [email protected]

Maurice Jiszda+41 44 333 21 [email protected]

Karim Cherif+41 44 334 56 [email protected]

Marcus HettingerHead of Global Forex Research+41 44 333 13 [email protected]

Pascal Zingg+41 44 333 24 [email protected]

Andreas Tomaschett+41 44 333 37 [email protected]

Christine Schmid+41 44 334 56 [email protected]

Benno Arnold+41 44 333 52 [email protected]

Thomas Claudio Kaufmann+41 44 334 88 [email protected]

Ulrich Kaiser+41 44 334 56 [email protected]

Christian Sutter+41 44 333 20 [email protected]


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