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									                                             About AFG

Company Snapshot
Since 1995, AFG has been a leading innovator in making Value Based Metrics relevant for institutional
investors. AFG's unique innovations include:

       Systematically linking economic profit to corporate value.
       Developing intuitive value driver models to explain economic profit.
       Empirically linking competitive advantage periods to company specific fundamental factors.
       Developing market-based discount rates that mitigate the problems with CAPM.

Most importantly, AFG’s research consistently leads to superior results for our clients. Our understanding of
valuation and corporate performance helps our clients identify everyday market opportunities.

AFG currently has approximately 140 institutional investor, consulting, and corporate clients
yielding over a 1,000 Users. We provide these clients fundamental valuation based research on over
6,000 U.S. Equities.

Corporate History
Rafael Resendes and Daniel Obrycki founded AFG in 1995 to develop a framework that addressed the flaws
with existing performance and valuation measures such as Cash Flow Return on Investment and Economic
Value Added. Prior to founding AFG, Resendes and Obrycki directed the research processes at HOLT
Value Associates where they developed the firm’s domestic and international valuation models. After
leaving HOLT, they dedicated a year of research to develop the Economic Margin Framework.
                                                                                                                                                             AFG Universe



                    4                                                                                                                                                                                                                                                                                                                                                             AFG Historical Buy & Sell
Cummaltive Return

                                                                                                                                                                                                                                                                                                                                                                                 Date Range: 8/1/1996 to 6/1/2004


















                                                                                                                                             Universe                                         AFG Buy                                          AFG Sell

                                                                                                                                                                                                                                                                                                                                                                            AFG Buy & Sell Recommendations
                             20.00%                                                                                                                                                                                                                                                                                                                                                     Analyzed Returns
                                                                                                                                                                                                                                                                                                                                                                                      Date Range: 3/96 to 9/04



                                                                                                AFG Buys                                                                                                 Market                                                                                             AFG Sells
                                          Why AFG?

Since the release of the AFGView software in 1996, AFG has continually set new standards for
investment analysis tools. AFGView allows users to quickly and easily analyze numerous pro-forma
scenarios to determine the intrinsic value of a company.

Here are a few reasons why so many institutional money managers are turning to AFG:
Focusing on Economics, Not Accounting - AFG's Economic Margin Framework™ corrects the
problems with EPS, ROI, EVA and CFROI measures, providing accurate and intuitive corporate
performance measurement.
Understanding Market Expectations - Only gives you access to Value Expectations™,
allowing you to quickly and accurately model the sales growth and profitability expectations built into
stock prices.
Improving Collaboration -'s Saving and Sharing™ capabilities allow you to organize
and share pro-forma models, company notes, portfolios, and screens with just a click of a button.
Getting Information Your Way - AFGView allows you to incorporate historic data and your own
custom models into a single excel sheet that you can design and format to your exact specifications.
Quickly Spotting Trends - AFG's Visual Analysis ™ allows you to build custom charts and save them
in a slide show to graphically dissect the factors driving corporate performance and price action on the
stocks you follow!
                              Framework Overview

AFG developed the Economic Margin (EM) Framework to evaluate corporate performance
from an economic cash flow perspective. AFG's metric goes beyond traditional accounting-
based analysis, correcting for distortions created by differences in:

 Capital Structure
 Asset Age
 Asset Life
 Asset Mix
 Off Balance Sheet Assets and Liabilities
 Investment Needed to Generate Earnings
 Cost of Capital

The goal of any value-based metric is to remove these and other accounting distortions to
provide true insights into corporate profitability, and comparability over time, firms, and
industries. By comparing a firm's Operating Cash Flow to its Cost of Capital, adjusted to
correct the distortions listed above, we can accurately measure a firm’s actual economic
profitability or its Economic Margin.
For additional information on AFG’s Economic Margin Framework, email us;
                                                                        Economic Margin
                                                  Operations Based Cash Flow:                                                  Capital Charge:
                                                   + Net Income                                                    Return on and Return of Capital that captures
                                                   + Depreciation & amortization                                   company specific economic circumstances.
                                                   + After Tax Interest Expense
                                                   + Rental Expense Net Int. Adj.
                                                   + R & D Expense
                                                   ± Non-Recurring Items

                                                                                Inflation Adjusted Invested Capital:
                                                                                     + Total Assets
                                                                                     + Accumulated Depreciation
                                                                                     + Gross Plant Inflation Adjustment
                                                                                     + Capitalized Operating Rentals
                                                                                     + Capitalized R & D
                                                                                     - Non Debt Current Liabilities

         Focusing on Economics, Not Accounting - AFG's Economic Margin Framework™ corrects the problems with
         EPS, ROI, EVA and CFROI measures, and yet provides accurate and intuitive corporate performance measurement.

           Notice the correlation between Wal Mart’s Price Return Performance and EM’s                                                               Same correlation with the S&P 500

         Wal Mart Cumulative Returns Versus S&P500                                         Wal Mart's Economic Margins

120                                                                                                                                                            6
                                                                         10.0%                                                                 (“MVIC”)        5
100                                                                       9.0%
                                                                          8.0%                                                                                                    R2 = .61
 60                                                                       6.0%                                                                                 2
                                                                          5.0%                                                                                 1
                                                                          4.0%                                                                                 0
                                                                                                                                                    -15 -10 -5 0    5 10 15 20 25
                                                                                                                                                                   EM %
                                                                                    1991     1992    1993   1994    1995   1996   1997
  1991    1992     1993        1994        1995    1996     1997
                                                                     WMT EM's       9.9%      9.5%   8.9%   8.1%    6.5%   6.3%   6.3%
                          Wal Mart    S&P 500
                            is the core product of The Applied Finance Group. As an internet based tool, allows analyst and portfolio managers access to research and investment tools
anywhere they have internet access…
                                            Value Expectations
Value Expectations (VE) allows you to quickly and accurately understand the sales growth and profitability expectations
built into stock prices. More importantly, VE is an intuitive application providing the ability to calculate an intrinsic value
based on your unique pro-forma assumptions. Get the information you need to avoid value traps, or passing on
intrinsically inexpensive high P/E stocks. Bottom line, by better understanding the performance priced into a company, you
will be better positioned to make more informed buy/sell/hold decisions.
                                                                                         Once you have built your projections in Value
                                                                                         Expectations, it will create complete proforma
                                                                                         financials that you can edit at a line item level
                                                                                         and incorporate into your other applications.
                                    Proforma Builder…

Proforma Builder: In certain situations, it may be necessary to model a company’s operations at a line-
item level to decipher the true value of the stock and produce presentation-quality financial statements.
The Pro Forma Builder is a seamless extension of Value Expectations for analysts who want to model the
operations of a business in more detail.

                                  The proforma builder allows the analyst to change line item by
                                  line item proforma financials for more in dept valuation.
                                                                                                                                                                      …Reports and Graphs
Presentation quality detailed analysis. With the click of a button access to printable, client-quality reports
and graphs.
                         Tear sheet Summary

                        DELL      DELL INC
                                                                                                                                     COMPUTER MANU
                                                                                                                                                                       A 20-page report with details on everything you need such as: Proforma
       Key Information                                         Company Description

                                                               Designs, develops, manufactures, markets, services and supports a range of
                                                                                                                                                                       Financials, Ratio Analysis, Variance Report, and Valuation Summary.
       Current Price              $35.00                       computer systems, including enterprise systems, notebook computers and desktop
       AFG Target Price           $52.07                       computer systems. It also markets software, peripherals and service and support
       % Upside                   48.8%                        programs.

       Market Cap (m)             $88,585                      Management Quality                      Above Average
       Shares Outstanding (m)     2531.00
       Dividend Yield             0.00%                        EM +1 - Invested Capital                      19.00
                                                               Asset Growth (1 yr)                          25.5%

                                                                                                       Forecast Data
       Value Drivers                           2001    2002            2003           2004     2005           2006            2007        2008     08 Actual

       Sales Growth                          -2.3%    13.6%           17.1%       18.7%      15.4%           7.2%          7.2%           7.2%      69,936
       Ebitda Margin                          8.1%     8.6%            9.2%        9.0%       9.0%           9.0%          9.0%           9.0%       6,294
       Asset Turns                             2.30     2.29            2.15        2.10       2.10           2.10          2.10           2.10     33,303

       Economic Performance
       EM (IC)
       EM (PC)
                                                                                                                                                  Fcst Median
                                                                                                                                                                    Pro Forma Income Statement
       Asset Grow (Actual)                  -10.0%     7.3%           25.5%       18.9%      13.1%           5.1%          5.1%          5.1%        5.1%
       Asset Grow (Sustainable)              22.7%    25.5%           26.9%       24.2%      23.6%          22.8%         22.8%         22.8%       22.8%

       Price Multiples                                                         Earnings History and Estimates
                                              DELL    Sector
                                                                               EPS Q4        Jan-04        $0.293                    Surprise               $0.01
           P/E           2003                 32.84   33.10                    EPS Q3        Oct-03        $0.264                    Surprise               $0.00
                         2004                 29.16   27.01                    EPS Q2         Jul-03       $0.242                    Surprise               $0.00
                                                                               EPS LFY         2003        $1.035
         P/Sales         2003                  2.10    2.60                    EPS (-1)        2002        $0.823
                         2004                  1.74    2.24
                                                                               EPS +1                      $1.250                    3-mo Chg            $0.020
         P/Book          LFQ                   9.03    2.78                    EPS +2                      $1.480                    3-mo Chg            $0.020
                                                                               EPS LT Growth               15.0%

       Stock Activity

       52-Week high                          $37.18       14.0%
       52-Week low                           $29.23       12.0%
       Avg. Volume (60d)                     16,308       10.0%
       Beta                                    1.66
1 mo   Price Return - 1 mo                   2.56%            6.0%
3 mo   Price Return - 3 mo                   8.19%
6 mo   Price Return - 6 mo                   2.19%
1 yr   Price Return - 1 yr                  13.02%            2.0%
       Return vs S&P - 1 mo                  5.30%
       Return vs S&P - 3 mo                 13.42%
       Return vs S&P - 6 mo                 -1.47%            -4.0%
       Return vs S&P - 1 yr                 -3.80%                             1 mo               3 mo                        6 mo                1 yr
                                                                                                     Return            Return vs. S&P

                                                                                                                                                                                                                              Free Cash Flow
                                                                                                                                                                                                                                                                                Free Cash Allocation & Financing
                                                                                                                                                                                                                                                                                                            DELL - DELL INC

                                                                                                                                                                                                                                                                Debt Issue                    Equity Issue                      Chg In Cash                      FFC (ex Cash)                         Total Dividend








                                                                                                                                                                                                                                   94            95             96             97             98            99             00            01            02            03             04            05            06            07            08
                                                                                                                                                                                                                              94            95             96             97             98            99             00            01            02            03             04            05            06            07            08
                                                                                                                                                                                                        FFC (ex Cash)                             -49            793            663            137          1972           3022           894          2548          1324           1864          2353          2879          3139          3403

                                                                                                                                                                                                        CASH DECISIONS:
                                                                                                                                                                                                        Chg In Cash                                   12             60         205            200          3289           1101          -1269          591            85            920           806           435           466           500
                                                                                                                                                                                                        Debt Issue                                    0           -95               -1         495               -4             1          11            -14              -1         108            94            51            55            58
                                                                                                                                                                                                        Equity Issue                                  68        -632           -456           -432          1321           -3023         -2174         -1943         -1238          -1052         -1641         -2495         -2727         -2961
                                                                                                                                                                                                        Total Dividend                  0             13             0              1              0             0              0             0             0             0              0             0             0             0             0
                                      Portfolio Diagnostics
Portfolio Characteristics: Quickly compare your portfolios against common benchmarks, or create
custom benchmarks using AFG's library of over 400 variables..

 Attribution Analysis: Compare your portfolio sector bets against popular or custom benchmarks to understand the
 source of each portfolio's over/under performance.

 Factor Analysis: Monitor the size and style of your portfolios versus those of popular or custom benchmarks to identify
 when a portfolio needs rebalancing.

 Portfolio Reporting: Takes the pain out of updating portfolios from your accounting system.
 Manages daily or intra-day updates automatically to liberate you from the hassles of staying informed.
 Allows for Custom report layouts integrating any portfolio’s data and charts. Save template for re-use or reference.
                                              AFG Screener
AFG Screener: Screen on hundreds of different variables and create custom screening criteria to develop a focused list to
study. AFG users have the ability to use proprietary metrics related to performance, valuation, and management quality to
enhance their lists and improve their chances to outperform.

                                                                                         Create Complex Screening Criteria

                                                                                                            View and Analyze

                                                                                                                 View the
                               Relative Value Suite
Relative Value Suite: Utilize AFGView’s database to analyze company multiples and benchmark them
against their peers, industry, sector, or index.

                                                                       Sensitivity Analysis: Easily change
                                                                       assumptions regarding multiples of
                                                                       Earnings, EBITDA, Sales, or Book
                                                                       Value to determine current
                                                                       upside/downside scenarios

                                                                       Flexibility: Utilize past or forward 12
                                                                       month multiple of earnings, sales, or
                                                                       EBITDA to identify company valuation,
                                                                       or make comparisons to indexes or
                                     Custom Graphs
Customized Graphs: With AFG’s power buttons, you can customize your own slide show and create
presentation quality graphs while benchmarking a company to their peer group.

                    Build a custom slide show using AFG’s power Buttons
                                    Corporate Events
Corporate Events: Track and listen to corporate events for companies in your portfolio or companies you
are tracking and place them into your personal events calendar.

                                                                                     Setting event reminder in
                                                                                     Outlook will help you
                                                                                     organize your calls.
                                     AFG-Excel Add-in
AFG-Link: State-of-the–art excel application that allows: 1) Integration with accounting systems, 2)
Collaborating data and applications with colleagues, and 3) Creating your own custom reports, calculations,
and custom applications.
                                                                                   Choose from hundreds of data
                                                                                   Items to customize your
                                                                                   template. Templates can be re-
                                                                                   used or saved for reference.

                                                                                   AFG Consultant Group:
                                                                                   available for advanced
                                                                                   spreadsheet design and VB

                                                                                   Research Platform: With the
                                                                                   AFG-Add-in you can also
                                                                                   download research from your
                                                                                   organization or a custom group.
Customized Templates
           Design your own templates, use AFG’s published
           templates, or work with AFG’s staff of experts to
           build a template that fits your unique needs.

                      The Factor Weighting Template is a
                      tool designed to provide a ranking of
                      an industry group based on user-
                      defined variables and weights.

                       Download AFG buy and sell criteria
                       along with other fundamental ratios.
                       The Portfolio Analyzer template
                       allows you to look at a number of
                       variables within a ticker list and rank
                       on any desired criteria.
Customized Templates

             The Stock Analyzer Template is designed to
             summarize a variety of data items on an
             individual company, while also providing
             seven unique tear sheets of the summarized

              The Saved Models Template is a template
              designed to organize saved Value
              Expectation models published to an AFG
              user group.
                                     AFG Research Platform
  AFG Research Platform: Now all of your Portfolio Managers and Analysts from anywhere in the world
  can share research interactively with a single click of a button.

                                                                              Customize your own platform
Seamlessly Integrate your                                                     groups, giving specific rights to
Organization’s Research into Excel                                            users
with the AFG Add-in, or share
screens, portfolios, proforma
models, or notes with your
                            Much More
Providing the most sophisticated, state of the art analytical tools
and Unbiased Research with BUY and SELL Recommendations!

                                   312- 362-
   For more information call us at 312-362-9903 or visit
                        AFG Insight
    Buy Sell List

                                   Monthly Buy/Sell list Across the Market
                           By using AFG’s proprietary criteria, AFG publishes a
                           monthly buy/sell list to provide you with a focused list of
                           buy/sell ideas.

Style and Sector Book
                                      Macro View Across Sector and Style
                            AFG’s Style/Sector Book is geared to providing a macro
                            view of current valuation, economic performance, and
                            market return metrics across different sectors and style
                            universes. In addition, you will be able to benchmark the
                            Valuation/Economic Performance characteristics of each
                            universe going back to October 1996.
             Research Products
The AFG 50
                          A Focused Portfolio to Outperform the S&P 500
                  The goal of our research team is to perform due diligence and in-
                  depth research to identify a focused group of stocks that will beat
                  the index our clients are most often measured against: The S&P
                  500. The AFG50 is an actively managed portfolio of 50 stocks that
                  will remain sector-neutral relative to the S&P 500. Since it’s
                  release in June 2004 at AFG’s annual conference in Las Vegas,
                  the AFG50 has outperformed the S&P 500 by more than 400 basis
                  points as of December 31, 2004.

                                   AFG HITs Hedge Fund Product
                  AFG HITs is a product designed for investors constantly searching
                  for buy/sell ideas with a short- term investment horizon. AFG’s
                  research has identified five factors that consistently identify stocks
                  likely to deliver significant short term over and under
                  performance. These factors are used to develop a highly focused
                  list of long and short ideas ready to move!
AFG50 Research Reports
   In depth research reports are issued on those companies held within
   the AFG50. These reports explain our rational for holding the
   company and highlight important insights to understand each
   company’s key economic drivers. When we drop a stock from the
   portfolio, we will justify why and provide a research report for our
   new addition.

   Leverage You Research by taking advantage of our analyst research!

                                   Performance on the AFG50 stocks
                                   are maintained and accessible on
                                 AFG Support Staff
AFG Equity Research Team - AFG analysts and staff closely work with our clients to make
sure they are getting the best use of our research and suite of analytic tools to meet their
needs. AFG’s team is often asked to participated in client research projects and perform
custom template building.

AFG also provides hands on solutions to client problems as well as provides learning tutorials
to enhance user education:

Ask your sales representative for a free trial and see for yourself why so many
money mangers are using AFG for their daily due-diligence and research needs!

"When I was a Principal at Stern Stewart & Co., many corporate managers would tell me that Wall Street
does not care about EVA or CFROI so why should they manage for it. That led me to search for a tool that
would link EVA to the common value driver language of Wall Street. The Applied Finance Group's
Economic Margin Framework is that link. Of all the Value - Based approaches, AFG offers the best blend of
theoretical completeness and practical applications as it provides a clear, robust and simple path from the
accounting to the economics. And just as important, AFG's ever-increasing number of web-based
applications, tools and research greatly increase the efficiency and effectiveness of our analytical processes."
David Berkowitz, Principal
Rapidan Capital LLC

"In my opinion, there is no better cash flow valuation available."

Robert F. Hill, Jr.
Shenandoah Asset Management

"In the course of my academic research on equity valuation, and my professional career as a portfolio
manager, I have evaluated numerous performance metrics and valuation methodologies. AFG offers an
unbeatable combination of Economic Margin Framework and Value Expectations software that is one of the
most theoretically sound and practically useful equity valuation platforms available today."
Bruce Johnson,
University of Iowa Professor of Accounting

"Having been a user since almost day one, I have seen your research service continue to improve and it has
become a more important part of my investment process. Having seen first hand the importance of the
direction of Economic Margins, this factor is now part of my quantitative ranking model. One of the more
important uses is the role it plays in questioning management/analyst projections - are they realistic based
on previous results, can the company actually deliver with the present asset base, etc.
Your firm continues to refine and improve the tools. Fairly recent additions, which I especially like, are the
industry reviews and monthly buy/sell list. Previously, I used Holt for many years, and was pleased with
that service. Upon the creation of AFG, I found your approach more intuitively-friendly. Retrieving the
information via the internet is also fast and convenient."
Portfolio Manager
Firm - Over 56 Billion Under Management

" AFG's rigorous research and powerful analytical tools leverages our time effectively to make better
investment decisions and better serve our clients. AFG is a valued partner in our research process!"
Ralph Weil, CIO
Clifford Associates

"AFG's Value Expectations model neatly incorporates the key measures of firm performance into a rigorous
valuation framework. A powerful tool for identifying potentially mispriced stocks."
Richard G. Sloan,
University of Michigan Professor of Accounting

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