Semiconductors

June 23, 2010

iPhone 4 Teardown Report SWKS Scores Big Wins, BRCM Continues Combo Strength
Patrick M. Newton, CFA (303) 291-5345 newtonp@stifel.com

Earlier today iFixit released teardown photos of the iPhone 4, scheduled to be released tomorrow morning, identifying the following component suppliers: Apple, Samsung, Broadcom, TI, Cirrus, ST Micro, Skyworks, and TriQuint. Additionally, we believe parts are supplied by Infineon and Dialog Semiconductor. iPhone 4 Demand? With much hype and overload of both Apple and AT&Ts pre-order websites, we believe pre-orders for the iPhone 4 eclipsed 600,000 units in the first day, with sales likely to easily eclipse 1 million units in the first weekend only limited by supply. We are estimating iPhone 4 shipments of roughly 6.3 million in 3Q10 and 9.1 million in 4Q10 with total iPhone shipments (including the 3G and 3GS) of 12.5 million in 3Q10 and 14 million in 4Q10. The expectations yield 2010 iPhone shipments of nearly 45 million, 15.4 million of which we expect to be iPhone 4. For 2011 we are targeting iPhone 4 sales of about 48.4 million and total iPhone sales of 51.4 million. We believe mix of iPhone 4 units and total volumes will see a much higher adoption rate than prior iterations due to 1) faster proliferation worldwide (88 countries targeted for release by September), 2) iPhone mindshare, and 3) compelling features compared to prior iPhone offerings. Given pre-sales of the iPhone 4 and upgrade inquiries at AT&T, we do believe demand in the U.S. could outstrip supply, with the potential to push international releases out similar to what we saw with the iPad.
Annual PA ASP Decline: Quad-Band EDGE Module ASP: W CDMA Module ASP: 3Q10 3G/3GS Mix iPhone Units 12.51 4Q10 3G/3GS Mix iPhone Units 14.01 35% 4.90 4G Mix 65% 9.11 iPhone Units 11.77 3Q11 3G/3GS Mix iPhone Units 13.54 4Q11 3G/3GS Mix iPhone Units 14.89 2% 0.30 4G Mix 98% 14.59 25.11 44.90 51.41 3% 0.41 4G Mix 97% 13.13 50% 6.26 4G Mix 50% 6.26 iPhone Units 11.21 2Q11 3G/3GS Mix 5% 0.59 4G Mix 95% 11.18 $ $ 1Q11 3G/3GS Mix 4G Mix 15% 85% 1.68 9.53 8% 1.00 1.25

CY09 iPhone Units: CY10 iPhone Units: CY11 iPhone Units: Source: Stifel Nicolaus Estimates

Component Suppliers: SWKS Gains Two PAs, BRCM Well Represented, TQNT Loses a Socket Below is a comparison of the iPhone 3G to the iPhone 4 with bolded sockets representing new design wins relative to prior generations.

All relevant disclosures and certifications appear on pages 8 - 11 of this report.

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iPhone 4 v. iPhone 3G Supplier Base

1st Generation 3GS iPhone (16GB) ASP (est. @ Supplier Supplier Part Number launch) Cellular Baseband Radio EDGE PA W CDMA PA W CDMA PA W CDMA PA W CDMA PA HSDPA LNA Switch/Filter Connectivity Bluetooth W iFi GPS Media Applications Processor Audio Codec Interface Touch Screen Controller Display Controller Display Interface 3-Axis Gyroscope Motion Sensor Power Management Charger/USB Controller PMIC (System) PMIC (Cellular) Memory NAND W ireless NOR/SRAM Toshiba Numonyx TH58NV67D2ELA89 36MY1EE $20.00-$25.00 $4.00-$6.00 Samsung Numonyx K9PFG08 36MY1EE $20.00-$25.00 $4.00-$6.00 Linear Dialog Infineon SMP 3i LTC3459 $2.00-$2.50 $1.00-$2.00 $1.50-$2.00 Dialog 338S086 Stifel Estimate $1.00-$2.00 ST Micro LIS331DLx $1.00-$2.00 ST Micro L3G4200D STM33DH $2.00-$3.00 TI F761586C $2.00-$3.00 TI 343SO499 $2.00-$3.00 Samsung Cirrus S5PC100 CS42L61 $12.00-$17.00 ~ $1.00 Apple Cirrus 338SO589 A4, APL0398 $12.00-$17.00 ~ $1.00 BRCM BRCM BCM4325 Combo (see above) $2.00-$3.00 $5.00-$6.00 BRCM BRCM BRCM BCM4329 Combo (see above) BCM4750 $2.00-$3.00 $5.00-$6.00 Infineon Murata BGA615L7 6475 < $1.00 ~ $1.00 Infineon Infineon Skyworks TriQuint TriQuint TriQuint X-Gold 608 (PMB8878) PMB6952 SKY77340 Quad-EDGE TQM616035 (800MHz) TQM686032 (1900MHz) TQM676031 (2100MHz) $10.00-$15.00 $2.50-$4.00 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 Infineon Infineon Skyworks Skyworks TriQuint TriQuint Skyworks 3833 X-Gold 616 (PMB9801) 338SO626 PMB5703 SKY77541 SKY77459 TQM686032 TQM676091 SKY77542 $10.00-$13.00 $2.00-$3.50 ~ $1.00 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 1st Generation iPhone 4 (16GB) Apple Part Number Supplier Part Number ASP (est. @ launch)

Supplier

IFX/BRCM PMB2525

Source: Company Reports and Stifel Nicolaus Estimates Bolded Product equal new design Wins

From a component perspective, we believe the largest departure from prior iPhone releases is in the redesign of the front-end, which was left unchanged from the iPhone 3G to 3GS. The redesign includes an additional WCDMA socket, bringing total 3G bands to four compared to three in the 3G and 3GS. Skyworks (SKWS, Buy, $17.40): Skyworks appears to be the largest share winner in the new iPhone, gaining the new WCDMA socket and displacing TriQuint (TQNT, Buy, $6.45) for another win for a total of two new sockets. We estimate SWKS has increased its iPhone dollar content to about $3.50 per iPhone 4 unit compared to prior 3G/3GS content of $1.00 a handset. Based on our above iPhone 4 unit expectations and annual ASP declines of 8%, we believe SWKS will generate roughly $64 million in Apple revenue in 3Q and 4Q 2010, and about $188 million in 2011, or about 15% of our FY11 revenue expectation of $1.2 billion.

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SWKS Apple Revenue Implications 3Q10 3G/3GS 4G Dollar 3G/3GS Un4G Units 6.26 6.26 Dollar Content $ 1.00 $ 3.50 $ 6.26 $ 21.90 4Q10 3G/3GS 4G Dollar 3G/3GS Un4G Units 4.90 9.11 Dollar Content $ 0.98 $ 3.43 $ 4.81 $ 31.24 1Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 1.68 9.53 Dollar Content $ 0.96 $ 3.36 $ 1.62 $ 32.03 2Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.59 11.18 Dollar Content $ 0.94 $ 3.29 $ 0.55 $ 36.84 3Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.41 13.13 Dollar Content $ 0.92 $ 3.23 $ 0.37 $ 42.39 4Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.30 14.59 Dollar Content $ 0.90 $ 3.16 $ 0.27 $ 46.17

Total Revenue $ 28.15

$ 36.05

$ 33.65

$ 37.39

$ 42.77

$ 46.44

Implicit CY10 Apple Revenue: $ 64.20 Implicit CY11 Apple Revenue: $ 160.25

Source: Stifel Nicolaus Estimates

TriQuint: With the loss of a WCDMA socket, TQNTs dollar content falls from roughly $3.75 in the iPhone 3G/3GS to $2.50 in the iPhone 4. Given our unit expectations, annual ASP declines, and iPhone 4/3G mix assumption, we believe TQNTs Apple related revenue will increase to $163 million in 2010 from $130 million in 2009 before declining to $123 million in 2011. We view the loss of a socket as generally expected and reflected in TQNTs share price given recent underperformance relative to peers and the expectation SWKS was increasing its Apple share. Additionally, we believe many investors had feared TQNT was designed out of Apple, speculation that we have continually refuted. Although the loss is likely to pressure long-term Apple revenue, we believe TQNT will continue to diversify its customer base and can perhaps avoid share concentration issues that plague the likes of RF Micro (RFMD, Hold, $4.44). Overall, we continue to believe TQNT is one of the best positioned RF Component vendors to participate in growing 3G and smartphone unit volumes given what we believe to be industry leading IP Outside of Apple, TQNT has scored . design wins with smartphone share gainers RIM and HTC (designed into the Incredible and EVO 4G) along with several wins inside Android based handsets (Galaxy S, Droid, etc.).

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TQNT Revenue Apple Implications 3Q10 3G/3GS 4G Dollar 3G/3GS Un4G Units 6.26 6.26 Dollar Content $ 3.75 $ 2.50 $ 23.46 $ 15.64 4Q10 3G/3GS 4G Dollar 3G/3GS Un4G Units 4.90 9.11 Dollar Content $ 3.68 $ 2.45 $ 18.03 $ 22.32 1Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 1.68 9.53 Dollar Content $ 3.60 $ 2.40 $ 6.06 $ 22.88 2Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.59 11.18 Dollar Content $ 3.53 $ 2.35 $ 2.08 $ 26.31 3Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.41 13.13 Dollar Content $ 3.46 $ 2.31 $ 1.40 $ 30.28 4Q11 3G/3GS 4G Dollar 3G/3GS Un4G Units 0.30 14.59 Dollar Content $ 3.39 $ 2.26 $ 1.01 $ 32.98

Total Revenue $ 39.10

40.34

28.94

28.39

31.68

33.99 130.86 163.79 123.00

CY09 Apple Revenue: $ Implicit CY10 Apple Revenue: $ Implicit CY11 Apple Revenue: $

Source: Stifel Nicolaus Estimates

Broadcom (BRCM, Buy, $35.58): The teardown also points to design wins for Broadcom, including chips for both WLAN/Bluetooth/FM functionality (as expected) and a GPS socket. Of note, the iPad included a touchscreen controller win for Broadcom, which we believe the firm gained at the expense of Texas Instruments. However, the touchscreen controller in the iPhone 4 (Apple part number 343S0499) is believed to be a Texas instrument win, identical to prior iPhone gnerations. Overall, we believe Broadcom is generating $6-$8 of content per iPhone 4 with the potential to earn an incremental $108 million in revenue using the mid-point of our assumed dollar content and 2010 iPhone 4 unit volumes (15.4 million). Additionally, in 2011 we believe the iPhone 4 could generate more than $300 million in revenue for BRCM. The 2011 revenue expectations represent about 5% of out FY11 revenue estimate with our expectation of a positive EPS impact approaching $0.07. Other Suppliers: Other key suppliers to the iPhone 4 generating the largest dollar content include Samsung supplying NAND (we estimate at a cost of $20-$25) and Infineon supplying the transceiver and baseband (likely $10-$15 of content). We believe the redesign of the front-end likely includes Infineons X-Gold 616 baseband (part number 3833 on the back-side of the PCB next to Numonyx NOR chip) and Infineons transceiver (part number 338SO626) based on reference design layouts on the companys website as well as its historical relationship as an iPhone supplier. Cirrus remains the audio codec supplier (338SO589), Apple is using its A4 for the applications processor (same as the
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iPad), Texas Instruments held onto its touchscreen controller socket (343SO499), and ST Micro landed the 3-axis gyroscope (L3G4200D). Lastly, there is a chip (Apple 338SO86) on the backside of the PCB which we believe is the system power management IC, and is likely Dialog Semiconductor if past supplier relationships are unchanged. CDMA iPhone Thoughts 1Q11 Release Expected Despite 4Q10 Chatter Much has been stated about the potential launch of a CDMA version of the iPhone which would target key geographies including networking in Korea, Japan, and the United States (Verizon and perhaps Sprint). Timing of the release seems to be the key area of debate, with many (including reports from DigiTimes) looking for a CDMA iPhone in 4Q10 in time for Christmas. Conversely, we strongly believe a CDMA version of the iPhone will be available in 1Q11 given checks with 1) RF component vendors, 2) baseband vendors, and 3) our belief exclusivity with AT&T in North America runs through 2010 (with Apple unlikely to release a CDMA version worldwide before leveraging potential with Verizon). We believe production of the CDMA version at Pegatron is likely to begin in 4Q10 in earnest, but do not anticipate commercial availability until 1Q11. Our checks indicate likely component vendors include Qualcomm (baseband), ANADIGICS (ANAD, Buy, $4.56 RF components), Apple (A4 applications processor), and Broadcom (connectivity, likely WLAN/Bluetooth/FM and GPS). All stocks priced intraday 6/23/2010.

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June 23, 2010

Historical Apple Product Supplier Base

1st Generation 2.5G iPhone (8GB) Apple Part Number Supplier Part Number 337S32535 338S0289 PM8876 S-Gold2 M1817A11 SKY77340 NA NA NA NA PE46212SP4T 41B14 BlueCore4-ROM W8686B13 NA 339S0030 ARM S5L8900B01 WM8758GD BCM5973A LPC2221 LM2512 LIS302D 4066 2992 NA CD3238 ASP (est. @ launch) $10.00-$12.00 $3.00-$5.00 $1.50-$2.50 1st Generation 3G iPhone (8GB) ASP (est. @ Supplier Part Number launch) X-Gold 608 (PMB8878) SMARTi 3GE (PMB6952) SKY77340 Quad-EDGE TQM616035 (800MHz) TQM686032 (1900MHz) TQM676031 (2100MHz) BGA736 6475 $13.00-$17.00 $3.00-$5.00 $1.50-$2.50 $1.00-$2.00 $1.00-$2.00 $1.00-$2.00 < $1.00 ~ $1.00 $2.00-$3.00 $2.00-$3.00 $3.00-$4.00 $15.00-$20.00 ~ $1.00 $2.00-$3.00 $1.00-$2.00 $1.50-$2.50 $2.00-$2.50 $1.50-$2.50 $2.00-$3.00 1st Generation 3GS iPhone (16GB) ASP (est. @ Supplier Supplier Part Number launch) Infineon Infineon Skyworks TriQuint TriQuint TriQuint Infineon Murata BRCM BRCM IFX/BRCM Samsung Cirrus TI X-Gold 608 (PMB8878) PMB6952 SKY77340 Quad-EDGE TQM616035 (800MHz) TQM686032 (1900MHz) TQM676031 (2100MHz) BGA615L7 6475 BCM4325 Combo (see above) PMB2525 S5PC100 CS42L61 F761586C $10.00-$15.00 $2.50-$4.00 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 < $1.00 ~ $1.00 $5.00-$6.00 $2.00-$3.00 $12.00-$17.00 ~ $1.00 $2.00-$3.00

Supplier Cellular Baseband Radio EDGE PA WCDMA PA WCDMA PA WCDMA PA HSDPA LNA Switch/Filter Connectivity Bluetooth WiFi GPS Media Applications Processor Audio Codec Interface Touch Screen Controller Display Controller Display Interface Motion Sensor Power Management Charger/USB Controller PMIC (System) PMIC (Cellular) PMIC (Display) Memory NAND Wireless NOR/SRAM Firmware Infineon Infineon Skyworks

Supplier Infineon Infineon Skyworks TriQuint TriQuint TriQuint Infineon Murata

Perigrine CSR Marvell

338S0297

$1.00-$200 $3.00-$4.00 $3.00-$3.50

CSR BlueCore6-ROM Marvell W8686R22 IFX/BRCM Hammerhead II (PMB2525) Samsung Wolfson Broadcom National ST Micro Linear NXP Infineon S5L8900B01 WM618OC BCM5974 LM2512 LIS331DL 4088-2 SMP 3i

Samsung Wolfson Broadcom NXP National ST Micro Linear NXP TI

$20.00-$25.00 ~ $1.00 $2.00-$3.00 $1.00-$2.00 $1.00-$2.00 $2.00-$3.00 $2.00-$2.50 $2.00-$2.50 $2.00-$2.50 $50.00-$70.00 $8.00-$12.00 ~ $1.00

343S0402

ST Micro Linear Dialog Infineon

LIS331DLx LTC3459 SMP 3i

$1.00-$2.00 $2.00-$2.50 $1.00-$2.00 $1.50-$2.00

338S0459

Samsung K9MCG08U5M (8GB) Intel PF38F1030W0YTQ2 SST 39WF800A Source: Company Reports and Stifel Nicolaus Estimates Bolded Product equal new design Wins

Toshiba Intel SST

TH58NV6D1DTG80 3050M0Y0CE SST25VF040B

$20.00-$25.00 $6.00-$10.00 ~ $1.00

Toshiba Numonyx

TH58NV67D2ELA89 36MY1EE

$20.00-$25.00 $4.00-$6.00

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1st Generation WLAN iPad (16GB) Suppliers

Supplier Connectivity Bluetooth WiFi Media Applications Processor Audio Codec Interface Touch Screen Controller Display Controller Display Interface Motion Sensor Memory NOR NAND Power Management Charger/USB Controller PMIC (System) PMIC (Display) Analog/Other DC/DC Regulator DC/DC Converter LCD Control IC Broadcom Broadcom Apple Cirrus Broadcom NXP STM Atmel Samsung 339S0084 338S0589 339S0107 Apple Part Number Supplier Part Number BCM4329XKUBG Combo (see above) A4, APL0398 CS42L61 BCM5973 L0614 (ZSD003) 33DH ASP (est. @ launch) $5.00-$6.00

$15.00-$18.00 ~ $1.00 $2.00-$3.00 $1.00-$2.00 $1.00-$2.00 < $1.00 $20.00-$25.00

LIS331DLH 25DF001
K9LCG08U1M

Dialog (est.) TI

338S0805 CD3240A1

$1.00-$2.00 $1.00-$2.00 $2.00-$3.00 $2.00-$3.00

Intersil 97645A1RZ Linear Tech 3442 LTC3442 LG Display SW0627B Source: Company Reports and Stifel Nicolaus Estimates Bolded Product equal new design Wins

WLAN 3G iPad - FCC Suppliers

Component Baseband Radio EDGE PA WCDMA PA WCDMA PA WCDMA PA GPS Wireless NOR/SRAM Switch/Filter Supplier Apple Part Number Supplier Part Number ASP (est. @ launch) $8.00-$12.00 $2.50-$4.00 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 $1.00-$1.50 $2.00-$3.00 $4.00-$6.00 ~ $1.00 Infineon 337S3754 PMB8878 Infineon 338SO353 PMB6952 Skyworks SKY77340 Quad-EDGE TriQuint TQM616035A (800MHz) TriQuint TQM666032B (1900MHz) TriQuint TQM676031A (2100MHz) Broadcom BCM47501UBG Numonyx 36MY1EE Murata RXCC 001 Source: Stifel Nicolaus Estimates

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Semiconductors Important Disclosures and Certifications

June 23, 2010

I, Patrick M. Newton, certify that the views expressed in this research report accurately reflect my personal views about the subject securities or issuers; and I, Patrick M. Newton, certify that no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views contained in this research report.
Rating and Price Target History for: ANADIGICS, Inc. (ANAD) as of 06-22-2010
02/26/10 I:H:NA 06/17/10 B:$5.5

20 16 12 8 4 Q1 Q2 Q3 2008 Q1 Q2 Q3 2009 Q1 Q2 Q3 2010 Q1 0 Q2

Rating Key B - Buy H - Hold S - Sell I - Initiation D - Dropped UR - Under Review NR - No Rating NA - Not Applicable RS - Rating Suspended

Created by BlueMatrix

For a price chart with our ratings and target price changes for ANAD go to http://sf.bluematrix.com/bluematrix/Disclosure?ticker=ANAD
Rating and Price Target History for: Broadcom Corporation (BRCM) as of 06-22-2010
10/15/07 B:$48 01/25/08 B:$37 09/19/08 B:$31 10/22/08 B:$26 12/08/08 B:$20 04/21/09 B:$25 07/24/09 B:$32 08/06/09 NR:NA 02/24/10 B:$38 04/28/10 B:$42

48 40 32 24 16 Q1 Q2 Q3 2008 Q1 Q2 Q3 2009 Q1 Q2 Q3 2010 Q1 8 Q2

Rating Key B - Buy H - Hold S - Sell I - Initiation D - Dropped UR - Under Review NR - No Rating NA - Not Applicable RS - Rating Suspended

Created by BlueMatrix

For a price chart with our ratings and target price changes for BRCM go to http://sf.bluematrix.com/bluematrix/Disclosure?ticker=BRCM

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Rating and Price Target History for: RF Micro Devices, Inc. (RFMD) as of 06-22-2010
08/07/09 NR:NA 02/26/10 H:NA

8 6 4

2 0 Q2

Q1

Q2

Q3 2008

Q1

Q2

Q3 2009

Q1

Q2

Q3 2010

Q1

Rating Key B - Buy H - Hold S - Sell I - Initiation D - Dropped UR - Under Review NR - No Rating NA - Not Applicable RS - Rating Suspended

Created by BlueMatrix

For a price chart with our ratings and target price changes for RFMD go to http://sf.bluematrix.com/bluematrix/Disclosure?ticker=RFMD
Rating and Price Target History for: Skyworks Solutions, Inc. (SWKS) as of 06-22-2010
07/19/07 B:$11 11/02/07 B:$13 07/02/08 B:$15 12/02/08 B:$12 07/23/09 B:$14 08/07/09 NR:NA 02/26/10 B:$18 04/30/10 B:$21

20 16 12 8 4 Q1 Q2 Q3 2008 Q1 Q2 Q3 2009 Q1 Q2 Q3 2010 Q1 0 Q2

Rating Key B - Buy H - Hold S - Sell I - Initiation D - Dropped UR - Under Review NR - No Rating NA - Not Applicable RS - Rating Suspended

Created by BlueMatrix

For a price chart with our ratings and target price changes for SWKS go to http://sf.bluematrix.com/bluematrix/Disclosure?ticker=SWKS

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Rating and Price Target History for: TriQuint Semiconductor, Inc. (TQNT) as of 06-22-2010
02/26/10 I:B:$9 04/29/10 B:$10.5

10 8 6 4 2 Q1 Q2 Q3 2008 Q1 Q2 Q3 2009 Q1 Q2 Q3 2010 Q1 0 Q2

Rating Key B - Buy H - Hold S - Sell I - Initiation D - Dropped UR - Under Review NR - No Rating NA - Not Applicable RS - Rating Suspended

Created by BlueMatrix

For a price chart with our ratings and target price changes for TQNT go to http://sf.bluematrix.com/bluematrix/Disclosure?ticker=TQNT Prior to February 24, 2010, a different Stifel, Nicolaus & Company, Inc. research analyst provided research coverage of Broadcom Corporation and its securities. Broadcom Corporation's price chart for the period prior to February 24, 2010 reflects the rating and price target history of the former Stifel Nicolaus research analyst for such issuer and its securities. Prior to February 25, 2010, a different Stifel, Nicolaus & Company, Inc. research analyst provided research coverage of RF Micro Devices, Inc. and its securities. RF Micro Devices, Inc.'s price chart for the period prior to February 25, 2010 reflects the rating and price target history of the former Stifel Nicolaus research analyst for such issuer and its securities. Prior to February 25, 2010, a different Stifel, Nicolaus & Company, Inc. research analyst provided research coverage of Skyworks Solutions, Inc. and its securities. Skyworks Solutions, Inc.'s price chart for the period prior to February 25, 2010 reflects the rating and price target history of the former Stifel Nicolaus research analyst for such issuer and its securities. Stifel, Nicolaus & Company, Inc. makes a market in the securities of ANADIGICS, Inc., Broadcom Corporation, RF Micro Devices, Inc., Skyworks Solutions, Inc. and TriQuint Semiconductor, Inc.. Stifel, Nicolaus & Company, Inc.'s research analysts receive compensation that is based upon (among other factors) Stifel Nicolaus' overall investment banking revenues. Our investment rating system is three tiered, defined as follows: BUY -We expect this stock to outperform the S&P 500 by more than 10% over the next 12 months. For higher-yielding equities such as REITs and Utilities, we expect a total return in excess of 12% over the next 12 months. HOLD -We expect this stock to perform within 10% (plus or minus) of the S&P 500 over the next 12 months. A Hold rating is also used for those higher-yielding securities where we are comfortable with the safety of the dividend, but believe that upside in the share price is limited. SELL -We expect this stock to underperform the S&P 500 by more than 10% over the next 12 months and believe the stock could decline in value. Of the securities we rate, 38% are rated Buy, 58% are rated Hold, and 4% are rated Sell. Within the last 12 months, Stifel, Nicolaus & Company, Inc. or an affiliate has provided investment banking services for 13%, 10% and 6% of the companies whose shares are rated Buy, Hold and Sell, respectively.
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Additional Disclosures Please visit the Research Page at www.stifel.com for the current research disclosures applicable to the companies mentioned in this publication that are within Stifel Nicolaus' coverage universe. For a discussion of risks to target price please see our stand-alone company reports and notes for all Buy-rated stocks. The information contained herein has been prepared from sources believed to be reliable but is not guaranteed by us and is not a complete summary or statement of all available data, nor is it considered an offer to buy or sell any securities referred to herein. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation or needs of individual investors. Employees of Stifel, Nicolaus & Company, Inc. or its affiliates may, at times, release written or oral commentary, technical analysis or trading strategies that differ from the opinions expressed within. Past performance should not and cannot be viewed as an indicator of future performance. Stifel, Nicolaus & Company, Inc. is a multi-disciplined financial services firm that regularly seeks investment banking assignments and compensation from issuers for services including, but not limited to, acting as an underwriter in an offering or financial advisor in a merger or acquisition, or serving as a placement agent in private transactions. Moreover, Stifel Nicolaus and its affiliates and their respective shareholders, directors, officers and/or employees, may from time to time have long or short positions in such securities or in options or other derivative instruments based thereon. These materials have been approved by Stifel Nicolaus Limited, authorized and regulated by the Financial Services Authority (UK), in connection with its distribution to professional clients and eligible counterparties in the European Economic Area. (Stifel Nicolaus Limited home office: London +44 20 7557 6030.) No investments or services mentioned are available in the European Economic Area to retail clients or to anyone in Canada other than a Designated Institution. This investment research report is classified as objective for the purposes of the FSA rules. Please contact a Stifel Nicolaus entity in your jurisdiction if you require additional information. The use of information or data in this research report provided by or derived from Standard & Poors Financial Services, LLC is Copyright 2010, Standard & Poors Financial Services, LLC (S&P). Reproduction of Compustat data and/or information in any form is prohibited except with the prior written permission of S&P Because of the . possibility of human or mechanical error by S&Ps sources, S&P or others, S&P does not guarantee the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. S&P GIVES NO EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. In no event shall S&P be liable for any indirect, special or consequential damages in connection with subscribers or others use of Compustat data and/or information. For recipients internal use only. Additional Information Is Available Upon Request 2010 Stifel, Nicolaus & Company, Inc. One South Street Baltimore, MD 21202. All rights reserved.

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