Mizzou Investment Fund Management SUMMER REPORT

Past, Present, and Futureof the University of Missouri Investment Fund• 1967- 1980 The Truman Tracy Fund• Arie and Ida Crown Fund• 1991 The Student Portfolio Analysis and Management Fund• 1999 Portfolio management course• 2005 Mizzou Investment Fund Mangement Program • 2006 Robert J. Trulaske, Sr. Endowment • 2008 Ace Greenberg Scholarship

Structure of the Class

Chief Financial Officer Matthew Roman• Portfolio Manager Steven Hinkle • Economist Specialist Nicholas Aiello • External Relation Specialist Brian Stieren

-Webmaster Jeremy Heuermann-Trader Kevin MeKenna- Recorder Justin Atwood

Program Coordinator Andrew Kern

Class Expectations• Hands on experience on managing a real fund • Sustain long run growth • Become actively involved in making informed

decisions for the fund

Restrictive Holdings • Short Positions• Derivative instrument investments• Borrowing/lending• Buying on Margin • No one industry will exceed 20% of total assets• No one security will exceed 5% of total assets

Allowable Holdings • U.S. stocks and bonds• International stocks and bonds• Money Market Instruments• Mutual Funds

Ending Positions• Most Profitable

- Varian Medical Systems - Baxter International Inc.- Wells Fargo

• Least Profitable- International Game Tech- Valero, PLC- Diageo, PLC

Transactions Date Company Ticker Shares Price

Current Price

% ∆ Since Trade

Transaction Cash Flow

6/19/2008 Valero Energy Corp VLO -530 44.08 31.88 -12.2 23,362.40

6/20/2008 Boeing BA 260 74.7499 63.83 -10.9199 (19,434.97)

6/24/2008 Diageo, Plc. DEO 225 73.23 57.59 -15.64 (16,476.75)

7/8/2008 Satyam Computer Service SAY -1000 24.6801 21.1 -3.5801 24,680.10

7/8/2008 International Game Tech IGT -750 23.45 21.1 -2.35 17,587.50

7/8/2008 Cisco Systems CSCO -600 22.64 22.43 -0.21 13,584.00

7/8/2008 Microsoft MSFT -300 26.16 25.86 -0.3 7,848.00

7/8/2008 Hewlett Packard HPQ 300 43.21 43.71 0.5 (12,963.00)

7/8/2008 Gilead Sciences Inc. GILD 200 53.16 54.51 1.35 (10,632.00)

7/8/2008 Western Digital WDC -740 35.03 30.94 -4.09 25,922.20

7/10/2008 Exxon Mobile XOM 400 85.32 81.7 -3.62 (34,128.00)

7/11/2008 NutriStystem NTRI 1000 17.19 16.26 -0.93 (17,190.00)

Total Change in Cash 2,159.48

Reviewed Stocks

Date Company Ticker Action Reviewed

Price Current

Price

% Change since

Review

6/25/2008Caterpillar Inc. CAT Held 77.08 69.53 -9.80%

6/26/2008Monsanto Co. Mon Held 133.08 116.09 -12.77%

7/2/2008 VF Corp. VFC Held 75.71 72.35 -4.44%

7/9/2008Freeport McMoran FCX Held 106.49 96.26 -9.61%

7/9/2008American Express APX None 41.59 36.62 -11.95%

7/15/2008 Ryanair RYAAY None 26.27 34.3 30.57%

7/16/2008Bank of America BAC None 19.54 29.58 51.38%

7/22/2008Whole Foods Market LLC WFMI None 22.53 22.52 -0.04%

7/23/2008Blackboard Inc. BBBB None 40 40.06 0.15%

7/24/2008 Coinstar CSTR None 33.78 33.34 -1.30%

7/28/2008CentryTel Inc CTL None 36.06 36.06 0.00%

Economic Overview Summer 2008• Oil Prices • Mortgage Crisis• Midwest Flooding

Economic Outlook• Oil Prices• U.S. Dollar• GDP • Home Sales

Portfolio Overview• Expectations

- Outperform the S&P 500- Recover before the end of the semester- Purchase below intrinsic value

Portfolio Overview• Sector Allocation Goals

Portfolio Overview • Sector Allocation Results

Company Analysis • General company description

– Includes location, industry, business functions, and key company aspects• Financials

– Ticker, sector, and industry– Ratios and valuations such as; market cap, beta, ROE, ROA, and P/E

• Economic and Industry Evaluation• Break Down of Close Competition• Charts & Graphs

– Company versus S&P, as well as against competitors• Company position within their respected industries• Risks associated with investment• Recent news• Recommendation

Example of Company Analysis

RyanAir

Buffett Analysis • Find Discount Rate and Owners Earning

Buffett Analysis• Find the Present Value of Owner’s Earnings

 Year  2008 2009 2010 2011 2012

Prior Year Owner Earnings

$ 54,121,000.0

$ 60,615,520.0

$ 67,283,227.2

$ 74,011,549.9

$ 80,672,589.4

First Stage Growth Rate (add) 12.0% 11.0% 10.0% 9.0% 9.0%

Owner Earnings $ 60,615,520.0

$ 67,283,227.2

$ 74,011,549.9

$ 80,672,589.4

$ 87,933,122.5

Discounted Value per annum $60,615,520.0 $60,052,648.2 $58,959,012.1 $57,359,062.6 $55,802,530.4

Sum of present value of owner earnings $292,788,773.2 

Buffett Analysis• Find Intrensic Value per Share

Residual Value

Owner Earnings in year 5 $ 87,933,122.5 Second Stage Growth Rate (g) (add) 3.00%

Owner Earnings in year 6 $ 90,571,116.1

Capitalization rate (k-g) 9.04%

Value at end of year 5 $ 1,001,848,548.00

Present Value of Residual $567,451,593.41 

Intrinsic Value of Company $860,240,366.59 

Shares outstanding assuming dilution 27930000

Intrinsic Value per share $30.80

Website • http://business.missouri.edu/IFMProgram/index.php

Question and Answer Secession