Morningstar Advisor - June/July 2009 - 61

Sector Snapshot: Industrial Materials The data shown on this page represent the companies in the industrial materials sector that are covered by Morningstar analysts—211 in total. We excluded the mining and gold industries in order to focus on traditional Sector Structure Moat Breakdown* % Breakdown S&P 500 manufacturing companies. The stocks highlighted include the seven widemoat stocks on the list, as well as the largest narrow-moat stocks. Overall, our analysts think the industrials group is trading at 88% of fair value. Industry Map 1 Key Stats Aggregates Total Market Cap 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 $1,559.5 billion 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 6479.800293 5234.600220 3989.400146 2744.200073 Market Cap 4 4 Wide Moat 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 31878.002303 25840.001727 19802.001152 13764.000576 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 23.2% 31878.002303 25840.001727 19802.001152 13764.000576 45.9% 31878.002303 25840.001727 19802.001152 13764.000576 Total Fair Value Total Revenue Valuation $1,765.5 billion 31878.002303 25840.001727 19802.001152 13764.000576 7726.000000 3 2 6 6 91412 7 12 14 5 5 Large 8 11 10 13 Narrow Moat No Moat 7726.000000 53.1% 23.7% 44.5% 9.7% $2,342.2 billion 7726.000000 7726.000000 Medium Stock Type Breakdown % Breakdown S&P 500 1499.000000 Sector 1282.600037 1067.200027 S&P 500 1282.600037 1067.200027 851.800018 636.400009 421.000000 420 336 252 168 84 0 High Yield Distressed Hard Asset Cyclical Slow Growth Classic Growth Aggressive Growth Speculative Growth Not Classified *Based on Morningstar analyst coverage. 4.1% 0.2% 0.0% 16.5% 16.6% 12.5% 16.9% 1.5% 31.6% 8.3% 1.0% 14.4% 14.4% 5.4% 28.4% 24.1% 3.3% 0.5% Price/Fair Value P/E Price/Book Price/Sales Price/Cash Flow Dividend Yield % Profitability and Financial Health 0.88 2.09 0.72 0.78 13.17 1.59 0.80 5.54 3.59 Undervalued 0 .5 Price/Fair Value 15 15 Small 851.800018 636.400009 421.000000 26.67 Overvalued 1 1.5 2 24.51 2.94 Sector S&P 500 0.0 0.0 0.0 ROE % ROA % Net Margin % Debt to Capital % Distance to Default 21.00 7.78 9.88 39.09 1.72 20.26 8.05 10.45 36.48 2.79 0.0 0.0 Industrial Materials companies are plotted based on their market cap and price/fair value ratio. Companies with a price/fair value ratio of less than one are undervalued. Companies with a ratio more than one are overvalued. Numbered plots show companies listed in the Notable Industrials Companies chart below. 0.5 1.0 1.5 2.0 0.5 0.5 1.0 1.5 2.0 2.0 1.0 1.5 0.0 0.5 1.0 1.5 2.0 0.5 0.5 1.0 1.0 1.5 1.5 2.0 2.0 0.0 0.5 1.0 1.5 2.0 Distance to Default is a measure of financial health. It represents the number of standard deviations separating a firm’s enterprise value from the value of its liabilities. The higher this number, the lower the probability of eminent financial distress. 0.0 0.0 0.5 0.5 1.0 1.0 1.5 1.5 2.0 2.0 0.0 0.0 0.0 0.5 0.5 0.5 0.5 0.5 0.5 1.0 1.0 1.0 1.0 1.0 1.0 1.5 1.5 1.5 1.5 1.5 1.5 2.0 2.0 2.0 2.0 2.0 2.0 Notable Industrials Companies Name/Ticker Morningstar Fair Value Per Share $ Ttl Rtn Annlzd 3-Yr Revenue ($mil) TTM Revenue Growth % 3-Yr FY1 Morningstar Rating Overall Fair Value Uncertainty Economic Moat 0.0 0.0 0.0 Growth Grade Profitability Grade Financial Distance Health to Grade Default Forward Dividend Yield % Free Cash Flow/Market Cap % 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 General Electric Company GE United Technologies UTX Monsanto Company MON 3M Company MMM Boeing Company BA Lockheed Martin Corporation LMT Emerson Electric Co. EMR Honeywell International, Inc. HON Caterpillar Inc. CAT Corning Inc. GLW Praxair, Inc. PX General Dynamics GD Danaher Corporation DHR Deere & Company DE Graco Incorporated GGG Data as of 5/6/09 22 59 145 85 53 81 37 27 51 12 60 65 52 56 28 –23.13 –5.46 25.93 –10.00 –19.23 3.24 –4.34 –6.98 –20.02 –19.08 10.88 –6.26 –2.86 0.82 –19.06 178,698 56,972 12,273 23,895 61,421 43,121 24,702 35,231 48,753 5,320 10,256 29,300 12,697 28,382 751 6.83 11.16 20.52 6.08 4.34 4.72 12.75 9.75 12.20 9.11 12.14 11.79 16.72 10.30 3.76 {{{{ {{{ {{{{{ {{{{{ {{{ {{{ {{{ {{ {{{{ {{{ {{ {{{{ {{{ {{{{ {{{ High Medium Medium Low Very High Medium Medium Medium Medium High Medium Medium High Medium Medium Wide Wide Wide Wide Narrow Wide Narrow Narrow Wide Narrow Narrow Wide Narrow Narrow Wide C C X C C C C C X V C C X C C C X X Z Z Z X X Z X X C C Z Z C X X Z X X X X C C X X Z C X 1.16 2.98 3.16 4.34 1.87 2.28 2.74 2.54 1.54 0.18 3.07 2.80 3.97 1.45 3.23 2.87 2.98 1.23 3.47 3.86 2.86 3.72 3.65 4.43 1.36 2.19 2.83 0.20 2.56 3.14 22.05 10.15 4.01 7.50 –6.56 11.28 9.63 11.80 10.26 0.91 1.90 12.65 8.57 1.84 9.19 MorningstarAdvisor.com 61
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Morningstar Advisor - June/July 2009

Table of Contents for the Digital Edition of Morningstar Advisor - June/July 2009

Morningstar Advisr - June/July 2009
Contents
New on MorningstarAdvisor.com
Letter from the Editor
Contributors
Is SRI a Relevant Investment Strategy?
A Head for Numbers
Building a Business on SRI
Investment Briefs
The Liquidity Premium
Navigating the SRI Patchwork
Profit and Progress
How the Fed Contributes to Crises
Holding Steady
Appleseed Adds Value to SRI Formula
Four Picks for the Present
Long-Term Investors Can Find Value among Industrials
Higher Yields, Hold the Risk
Bargains in U.S. Industrials
Mutual Fund Analyst Picks
50 Most Popular Equity ETFs
Undervalued Stocks
Most Popular Variable Annuities
New at Morningstar
Talkin’ ‘bout a Revolution
Morningstar Advisor - June/July 2009 - 47
Morningstar Advisor - June/July 2009 - Morningstar Advisr - June/July 2009
Morningstar Advisor - June/July 2009 - Cover2
Morningstar Advisor - June/July 2009 - Contents
Morningstar Advisor - June/July 2009 - 2
Morningstar Advisor - June/July 2009 - 3
Morningstar Advisor - June/July 2009 - New on MorningstarAdvisor.com
Morningstar Advisor - June/July 2009 - 5
Morningstar Advisor - June/July 2009 - 6
Morningstar Advisor - June/July 2009 - Letter from the Editor
Morningstar Advisor - June/July 2009 - Contributors
Morningstar Advisor - June/July 2009 - 9
Morningstar Advisor - June/July 2009 - Is SRI a Relevant Investment Strategy?
Morningstar Advisor - June/July 2009 - 11
Morningstar Advisor - June/July 2009 - A Head for Numbers
Morningstar Advisor - June/July 2009 - 13
Morningstar Advisor - June/July 2009 - 14
Morningstar Advisor - June/July 2009 - Building a Business on SRI
Morningstar Advisor - June/July 2009 - 16
Morningstar Advisor - June/July 2009 - 17
Morningstar Advisor - June/July 2009 - Investment Briefs
Morningstar Advisor - June/July 2009 - 19
Morningstar Advisor - June/July 2009 - 20
Morningstar Advisor - June/July 2009 - 21
Morningstar Advisor - June/July 2009 - 22
Morningstar Advisor - June/July 2009 - The Liquidity Premium
Morningstar Advisor - June/July 2009 - 24
Morningstar Advisor - June/July 2009 - 25
Morningstar Advisor - June/July 2009 - 26
Morningstar Advisor - June/July 2009 - 27
Morningstar Advisor - June/July 2009 - 28
Morningstar Advisor - June/July 2009 - 29
Morningstar Advisor - June/July 2009 - Navigating the SRI Patchwork
Morningstar Advisor - June/July 2009 - 31
Morningstar Advisor - June/July 2009 - 32
Morningstar Advisor - June/July 2009 - 33
Morningstar Advisor - June/July 2009 - 34
Morningstar Advisor - June/July 2009 - Profit and Progress
Morningstar Advisor - June/July 2009 - 36
Morningstar Advisor - June/July 2009 - 37
Morningstar Advisor - June/July 2009 - 38
Morningstar Advisor - June/July 2009 - 39
Morningstar Advisor - June/July 2009 - How the Fed Contributes to Crises
Morningstar Advisor - June/July 2009 - 41
Morningstar Advisor - June/July 2009 - 42
Morningstar Advisor - June/July 2009 - 43
Morningstar Advisor - June/July 2009 - 44
Morningstar Advisor - June/July 2009 - 45
Morningstar Advisor - June/July 2009 - 46
Morningstar Advisor - June/July 2009 - 47
Morningstar Advisor - June/July 2009 - Holding Steady
Morningstar Advisor - June/July 2009 - 49
Morningstar Advisor - June/July 2009 - 50
Morningstar Advisor - June/July 2009 - 51
Morningstar Advisor - June/July 2009 - Appleseed Adds Value to SRI Formula
Morningstar Advisor - June/July 2009 - 53
Morningstar Advisor - June/July 2009 - 54
Morningstar Advisor - June/July 2009 - 55
Morningstar Advisor - June/July 2009 - Four Picks for the Present
Morningstar Advisor - June/July 2009 - 57
Morningstar Advisor - June/July 2009 - Long-Term Investors Can Find Value among Industrials
Morningstar Advisor - June/July 2009 - 59
Morningstar Advisor - June/July 2009 - 60
Morningstar Advisor - June/July 2009 - 61
Morningstar Advisor - June/July 2009 - Higher Yields, Hold the Risk
Morningstar Advisor - June/July 2009 - 63
Morningstar Advisor - June/July 2009 - Bargains in U.S. Industrials
Morningstar Advisor - June/July 2009 - 65
Morningstar Advisor - June/July 2009 - Mutual Fund Analyst Picks
Morningstar Advisor - June/July 2009 - 67
Morningstar Advisor - June/July 2009 - 68
Morningstar Advisor - June/July 2009 - 69
Morningstar Advisor - June/July 2009 - 50 Most Popular Equity ETFs
Morningstar Advisor - June/July 2009 - 71
Morningstar Advisor - June/July 2009 - Undervalued Stocks
Morningstar Advisor - June/July 2009 - 73
Morningstar Advisor - June/July 2009 - 74
Morningstar Advisor - June/July 2009 - 75
Morningstar Advisor - June/July 2009 - Most Popular Variable Annuities
Morningstar Advisor - June/July 2009 - 77
Morningstar Advisor - June/July 2009 - 78
Morningstar Advisor - June/July 2009 - New at Morningstar
Morningstar Advisor - June/July 2009 - Talkin’ ‘bout a Revolution
Morningstar Advisor - June/July 2009 - Cover3
Morningstar Advisor - June/July 2009 - Cover4
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