Bill Gunderson s Weekly Best Stocks Now Newsletter

Bill Gunderson s Weekly Best Stocks Now Newsletter Straightforward, honest research for successful people http://www.pwstreet.com @BillGunderson on Twitter Bill@pwstreet.com Let me hear from you! May 25, 2012 Bill Gunderson-President and Founder of Gunderson Capital Mgt. Inc. A Big Fat Greek Mess From my perspective, it has been a fun week in the market. Although it did not seem like it, the equities markets actually closed with a nice gain for the week. Many leaders continue to lead the market, despite the chaos in Europe, and the fallout from the Facebook (FB) IPO has been amusing to watch. My new office in downtown San Diego houses one of Morgan Stanley s largest branches. I noticed a lot of angry looking people hanging around in the hallway wanting to talk to their MS broker. They must not have listened to the warnings that I have given over the years about buying into IPO manias. This whole thing is a mess for Morgan Stanley and the chart of the stock reflects it: 1

The people who work there don t look very happy either. They are real unfriendly as we ride up the elevator together. They all look like they want to cancel their Facebook profiles. It remains to be seen whether or not Morgan Stanley will ever get another high-profile IPO like Facebook in the future. Needless to say, I am not a buyer or holder of the stock. The attorneys in my building are licking their chops, however. Let the lawsuits begin. How convenient to have all of these attorneys and Morgan Stanley folks in the same building. They can all just walk across the street to the courthouse. If you think that the Facebook IPO was a mess, look at what is going on in Europe! The yield on the ten-year bond in Greece is now 29.9% and rising! That sounds like my first car loan. No wonder that Germany is not real enamored with the Euro Bond idea that is being tossed around. Germany is currently paying 1.4% to borrow money. France pays just a 2.5% rate on its debt. I would not think that they would be too happy with a Euro Bond either. Do they want to share in the financial mess in Greece, Spain, Portugal, and Italy? The Portuguese are paying 12.5%, while Spain and Italy are up around 6%. 2

Italy s leader, Mario Monti, thinks that he can sell the idea of a Euro Bond to the other EU members, but I am not buying it. Monti is having a hard enough time fixing his own countries problems, let alone the rest of the EU s problems. The United States is currently paying 1.7% to borrow money while Brazil is paying 12.5%. Do we want to average things out on the American continent and share one another s burdens? An increase in our interest rates would be a crushing blow to our already bloated deficit. Here are the numbers on the week. Note that the NASDAQ fared best of all, despite the Facebook debacle. Spain, Greece, Europe in general, and the Emerging Markets continue to get pummeled. Here is where we stand year-to-date: Fri. 5/18/12 Fri. 5/25/12 Week Week Pct. Close Close Change Change S&P500 1295.22 1318.72 23.50 1.81% DJIA 12,369.38 12,454.83 85.45 0.69% NASD 2778.79 2837.53 58.74 2.11% S&P600 (Small) 423.10 430.95 7.85 1.86% Emg. Mkts (ADRE) 36.27 36.41 0.14 0.39% Spain (EWP) 23.44 22.89-0.55-2.35% U.S. 10yr. Tr. 1.70% 1.75% 0.05% 2.94% Greece 10yr. Bond 21.08% 29.98% 8.90% 42.22% Brazil 10yr. Bond 12.53% 12.55% 0.02% 0.16% Portugal 10yr. Bond 11.53% 12.45% 0.92% 7.98% Spain 10yr. Bond 5.35% 6.16% 0.81% 15.14% Oil 91.80 90.71-1.09-1.19% Gold 1587.60 1572.40-15.20-0.96% 3

12/31/11 Fri. 5/25/12 2012 YTD Pct. Value Close YTD Change S&P500 1257.60 1318.72 61.12 4.86% DJIA 12,239.74 12,454.83 215.09 1.76% NASD 2610.68 2837.53 226.85 8.69% S&P600 (Small) 415.07 430.95 15.88 3.83% Emg. Mkts (ADRE) 39.89 36.41-3.48-8.72% Spain (EWP) 30.37 24.91-5.46-17.98% U.S. 10yr. Tr. 1.87% 1.75% -0.12% -6.42% Spain 10yr. Bond 5.22% 6.16% 0.94% 18.01% Oil 98.87 90.71-8.16-8.25% Gold 1565.90 1572.40 6.50 0.42% Let s look at a few charts. The S & P 500 was plunging last week at this time. Last week, I gave several very strong reasons as to why the market should begin to hold. As you can see from the above chart, so far it has. 4

We are still vulnerable down to the 200 day moving average which currently stands at 1,280. We are now at 1,317. Should the market plunge below its 200 day moving average however, then we would have a whole new ballgame. Let s next look at the driver of the bus, the U. S. Dollar (UUP): The dollar has been almost straight up for the last three weeks! Remember that the equities markets and commodities move in the opposite direction of the dollar. You can also see the dollar hitting resistance. If the dollar breaks out through resistance it could also be a big game changer. The first chart I look at every day is the market. The second chart I look at is the dollar. The third chart I look at is the Euro (FXE): 5

As you can see, the Euro closed at a new low of 124.48 in Friday. This is leading to the erosion in our markets and incommodities. A further breakdown of the Euro will also have stinging consequences on our market. What can be done about this situation? I wrote an article on Friday for Markewatch.com about hedging portfolios with INVERSE funds. Here is the link to the article if you are interested in reading it: http://www.marketwatch.com/story/hedging-your-portfolio-with-inverse-funds-2012-05-25?reflink=mw_news_stmp I have bought two inverse ETF s so far in the accounts that I manage, that had cash available. The first one is has an inverse relationship with the Emerging Markets: 6

As you can see, as the market is threatening to break down below its 200 day moving average, EUM is breaking through to the upside of its average. The Emerging Markets are extremely dependent upon Europe for their own economies. This area continues to be very vulnerable. If things smooth out and the EU is able to solve its problems, then I will move away from the inverse funds. But, for now I feel better having them, than not. Here is how EUM has moved up in rank recently: 7

It has been buried at the bottom of the heap since last summer. It was at 1,780 last week, and is now at #47 overall. If it remains in the top 100 for a while, then it will be a money-making opportunity. I also own an inverse fund on Europe (EFZ), I added it this past week: As you can see, it got slaughtered from last October until the beginning of April of this year. I would have hated to own it during that huge drop! It is now rocketing higher as Europe moves lower. EFZ is now ranked number 75 overall, while it was number 1,779 just four weeks ago! If the market continues to break down, I will consider adding more hedges. FXP is a double-short on China. China is slowing down considerably. They are shuttering steel and aluminum plants. This not good news for commodity rich South America, which depends on Chinese exports for the health of their own economies. Believe it or not, FXP is now ranked number 9 overall! It has been buried at the bottom since last summer! 8

I hung up the CAUTION sign four weeks ago, after being bullish for 6 months. The uptrend in the market came to an end, and we next entered into a sideways trend. We next broke down out of the sideways trend, and we are currently looking for support. It is definitely best to step very gingerly right now. @billgunderson. Please follow me on Twitter, Facebook, or LinkedIn throughout the week for any changes in my current stance on the market or individual stocks. My tweets are also found on my BEST STOCKS NOW app every day, and on the homepage of my website: http://www.pwstreet.com 9

Bill Gunderson s Model Portfolio for Conservative Growth Investors: This model is made up of mostly mid-cap and large cap companies, that I consider to be suitable for investors who have a conservative risk profile, but still want growth. This portfolio is up 11.0% year-to-date, while the S & P 500 is up 5.1%. The portfolio currently has a 14.0% cash position and I am adding another hedge this week. I am also selling FXM and EC this week and adding BIIB and EFZ. 10

Conservative Growth Model as of 5/25/2012 11.0% S&P 500 5.1% Ahead by 5.9% (as of 9am) Add Add Beginning Current Current Date Symbol Name Sector Price Shares Value Price Value G/L Alloc. 1 22-Oct-10 AZO Autozone Consumer $234.72 14 $3,286 $373.00 $5,222 58.9% 4.4% 2 6-Jan-12 AAPL Apple Computer Technology $422.40 9 $3,802 $558.76 $5,029 32.3% 4.2% 3 11-May-12 AMT American Tower Telecom $67.86 70 $4,750 $65.75 $4,603-3.1% 3.9% 4 25-May-12 BIIB Biogen Drug $131.75 36 $4,743 $131.75 $4,743 0.0% 4.0% 5 9-Mar-12 BPT B P Prudhoe Bay Energy $124.11 38 $4,716 $113.06 $4,296-8.9% 3.6% 6 30-Sep-11 DG Dollar General Consumer $37.76 121 $4,569 $47.60 $5,760 26.1% 4.8% 7 27-Apr-12 DISCA Discovery Com Cl A Media $54.93 70 $3,845 $50.59 $3,541-7.9% 3.0% 8 26-Aug-11 DLTR Dollar Tree Consumer $70.46 65 $4,580 $101.53 $6,599 44.1% 5.5% 9 25-May-12 EFZ Europe Inverse 1X Inverse $52.06 91 $4,737 $52.06 $4,737 0.0% 4.0% 10 6-Apr-12 ESRX Express Scripts Medical $56.94 70 $3,986 $52.55 $3,679-7.7% 3.1% 11 6-Apr-12 FDO Family Dollar Consumer $64.84 62 $4,020 $67.48 $4,184 4.1% 3.5% 12 18-May-12 EUM Emg. Mkts. Inverse 1:1 Hedge $33.32 142 $4,731 $33.32 $4,731 0.0% 4.0% 13 20-Apr-12 ISRG Intuitive Surgical Medical $575.60 8 $4,605 $528.01 $4,224-8.3% 3.5% 14 26-Aug-11 MA Mastercard Consumer $325.17 14 $4,552 $416.02 $5,824 27.9% 4.9% 15 11-May-12 NVO Novo Nordisk Drug $145.73 32 $4,663 $141.87 $4,540-2.6% 3.8% 16 20-Apr-12 ORLY O'Reilly Automotive Consumer $96.63 48 $4,638 $96.93 $4,653 0.3% 3.9% 17 21-May-10 ROST Ross Stores Consumer $25.76 68 $1,751 $62.39 $4,243 142.2% 3.6% 18 7-Jan-11 PCLN Priceline.com Consumer $440.59 7 $3,084 $656.65 $4,597 49.0% 3.9% 19 21-Oct-11 SBUX Starbucks Consumer $41.93 108 $4,528 $54.49 $5,885 30.0% 4.9% 20 7-Oct-11 TJX T J Maxx Consumer $27.77 164 $4,553 $41.01 $6,726 47.7% 5.7% 21 20-Apr-12 YUM Yum! Brands Consumer $73.72 63 $4,644 $70.59 $4,447-4.2% 3.7% CASH 14.1% Bill Gunderson s Model Portfolio for Investors seeking AGGRESSIVE Growth This is my most aggressive portfolio. It is designed for investors with long-term time horizons, seeking maximum growth. This portfolio is made up mainly of small and mid-cap stocks with superior growth potential. This portfolio is much more volatile than the Conservative Growth Portfolio and the Income Portfolio. This portfolio 11

also carries more risk than the other two. It also has a higher turnover rate. It has the most upside potential, however. This portfolio is up 11.7% YTD, while the S & P 500 is up 5.0%. I am selling Seagate (STX) and Priceline.com (PCLN) this week and adding EFZ and Pharmacyclics (PCYC). Cash level is now 0.7% in my Aggressive Growth Model. Ahead Gunderson Aggressive Growth Model Portfolio 11.7% YTD S&P 500 5.0% by 6.7% As of May 25, 2012 (8:30AM) Add Add Begin Current Current Current Symbol Name Sector Date Price Shares Value Price Value G/L Allocation 1 AAPL Apple Comp. Technology 5-Mar-10 $218.95 8 $1,752 $560.87 $4,487 156.2% 3.7% 2 ALLT Allot Communications Technology 20-Apr-12 $23.57 210 $4,950 $23.92 $5,023 1.5% 4.2% 3 AZO Autozone Consumer 8-Oct-10 $232.81 9 $2,095 $372.85 $3,356 60.2% 2.8% 4 CLB Core Labs Energy 27-Apr-12 $136.02 37 $5,033 $135.35 $5,008-0.5% 4.2% 5 DLTR Dollar Tree Consumer 21-May-10 $40.69 50 $2,035 $101.38 $5,069 149.1% 4.2% 6 EFZ Europe Inverse 1:1 Inverse 25-May-12 $51.98 92 $4,782 $51.98 $4,782 0.0% 4.0% 7 EUM Emg. Mkts Inverse 1:1 Inverse 18-May-12 $33.32 138 $4,598 $33.33 $4,600 0.0% 3.8% 8 FDO Family Dollar Consumer 6-Apr-12 $64.84 70 $4,539 $67.46 $4,722 4.0% 3.9% 9 GNC General Nutrition Consumer 11-May-12 $40.67 121 $4,921 $39.49 $4,778-2.9% 4.0% 10 HIBB Hibbett Sporting Goods Consumer 11-May-12 $60.28 82 $4,943 $56.93 $4,668-5.6% 3.9% 11 LQDT Liquidity Services Consumer 20-Apr-12 $52.20 95 $4,959 $62.67 $5,954 20.1% 5.0% 12 MNST Monster Beverage Consumer 11-May-12 $71.28 69 $4,918 $71.39 $4,926 0.2% 4.1% 13 NTES Netease.com Leisure 23-Mar-12 $59.59 73 $4,350 $57.45 $4,194-3.6% 3.5% 14 OSIS O S I Systems Technology 9-Mar-12 $60.97 79 $4,817 $64.99 $5,134 6.6% 4.3% 15 PCYC Pharmacyclics Drug 25-May-12 $32.85 145 $4,763 $32.85 $4,763 0.0% 4.0% 16 PII Polaris Industries Consumer 28-Oct-11 $62.71 72 $4,515 $77.53 $5,582 23.6% 4.7% 17 QCOR Questcor Pharm. Drug 27-Apr-12 $44.70 110 $4,917 $41.41 $4,555-7.4% 3.8% 18 REGN Regeneron Pharm. Drug 20-Apr-12 $127.10 39 $4,957 $130.68 $5,097 2.8% 4.2% 19 SBH Sally Beauty Hldg. Consumer 21-Oct-11 $18.80 239 $4,493 $26.80 $6,405 42.6% 5.3% 20 SLXP Salix Pharmaceuticals Medical 23-Mar-12 $52.60 78 $4,103 $51.10 $3,986-2.9% 3.3% 21 SXCI S X C Health Solutions Medical 9-Mar-12 $73.02 66 $4,819 $89.82 $5,928 23.0% 4.9% 22 TSCO Tractor Supply Consumer 11-May-12 $98.94 50 $4,947 $99.40 $4,970 0.5% 4.1% 23 VVUS Vivus Inc. Drug 18-May-12 $22.40 205 $4,592 $24.73 $5,070 10.4% 4.2% 24 TDG Transdigm Group Aerospace 27-Apr-12 $127.14 40 $5,086 $125.17 $5,007-1.5% 4.2% CASH 0.7% Bill Gunderson s Model Portfolio for investors seeking Income along with the possibility of Growth. This model is my most conservative model. It is designed for risk-adverse investors that want income first and growth second. Income producing investments have proven themselves over time to be much less volatile than pure growth investments. If you look back at the year 2008, when the overall market was 12

down 38.5%, income producers held up much better. They also underperform during a go-go market, however. This portfolio is designed as a bond or CD alternative, albeit with more risk. This portfolio currently has an average yield of 5.9%. Compare this with the current U.S. Treasury yield of 1.7% and current CD yields. This portfolio is up 10.1% since its August 2011 inception. That works out to very nice annualized rate. No changes this week. These are the best income and growth stock that I can find right now: INCOME Model as of May 25, 2012 (as of 10:30AM) 3.73% YTD S&P 500 5.04% -1.31% Inception Date August 5, 2011 10.06% Since Inception S&P 500 0.00% 10.14% Add Beg. Current Current Curr. Added Symbol Name Sector Price Shares Value Price Value G/L Alloc. Yield 1 5-Aug-11 AGNC Amer. Cap. Agency Mortgage $28.35 176 $4,990 $32.26 $5,678 13.8% 5.3% 16.1% 2 11-Nov-11 ACC Amer. Campus Comm. REIT $38.65 106 $4,097 $43.92 $4,656 13.6% 4.3% 3.1% 3 11-Nov-11 AMLP Alerian MLP Energy $15.79 258 $4,074 $15.99 $4,125 1.3% 3.8% 6.4% 4 13-Apr-12 AVB Avalon Bay Comm. REIT $140.70 32.0 $4,502 $139.86 $4,476-0.6% 4.1% 2.8% 5 6-Jan-12 BPT B P Prudhoe Bay Energy $117.12 36.0 $4,216 $112.91 $4,065-3.6% 3.8% 9.5% 6 23-Mar-12 BTI British Tobacco Consumer $100.53 40.0 $4,021 $95.67 $3,827-4.8% 3.5% 4.2% 7 4-May-12 EPD Enterprise Products Energy $52.35 75.0 $3,926 $49.64 $3,723-5.2% 3.4% 5.2% 8 5-Aug-11 KMP Kinder Morgan Energy $68.03 74 $5,034 $79.82 $5,907 17.3% 5.5% 5.6% 9 13-Apr-12 LO Lorillard Consumer $138.88 32.0 $4,444 $125.80 $4,026-9.4% 3.7% 4.5% 10 21-Oct-11 MMP Magellan Mid. Ptrs. Energy $63.02 64 $4,033 $69.46 $4,445 10.2% 4.1% 4.5% 11 4-May-12 NGLS Targa Resources Energy $45.35 85.0 $3,855 $41.13 $3,496-9.3% 3.2% 5.5% 12 5-Aug-11 NHI Nat. Health Investors REIT $40.60 123 $4,994 $48.60 $5,978 19.7% 5.5% 5.3% 13 9-Sep-11 OKS Oneok Ptrs. Energy $43.29 91 $3,939 $55.49 $5,050 28.2% 4.7% 4.4% 14 5-Aug-11 O Realty Income REIT $30.01 167 $5,012 $38.70 $6,463 29.0% 6.0% 4.6% 15 5-Aug-11 OHI Omega Healthcare REIT $15.82 316 $4,999 $21.05 $6,652 33.1% 6.2% 7.8% 16 9-Mar-12 PVD Admin Fondos Pension Finance $75.84 48.0 $3,640 $73.28 $3,517-3.4% 3.3% 6.7% 17 11-May-12 SKT Tanger Factory Outlet REIT $32.58 140.0 $4,561 $31.25 $4,375-4.1% 4.1% 2.6% 18 7-Oct-11 SXL Sunoco Logistics Ptrs. Energy $29.92 132 $3,949 $34.61 $4,569 15.7% 4.2% 4.4% 19 3-Feb-12 SDRL Seadrill ltd Energy $37.88 117.0 $4,432 $35.14 $4,111-7.2% 3.8% 8.5% 20 11-May-12 TGH Textainer Corp. Trans. $36.64 123.0 $4,507 $33.94 $4,175-7.4% 3.9% 4.4% 21 9-Mar-12 WES Western Gas Partners Energy $46.66 97.0 $4,526 $44.12 $4,280-5.4% 4.0% 3.7% 22 6-Jan-12 WHX Whiting Usa Trust Energy $17.83 240.0 $4,279 $17.17 $4,121-3.7% 3.8% 17.4% 23 5-Aug-11 WPC W P Carey REIT $35.80 140 $5,012 $44.77 $6,268 25.1% 5.8% 4.8% 24 5-Aug-11 CASH Money Market Cash $1.00 0 $0 $1.00 $2,084 0.0% 1.9% 0.0% 5.9% Bill Gunderson is a professional fee-based money manager. Gunderson Capital Management manages hundreds of accounts all across the country. Minimum account size is $50,000. Annual Mgt. fees are 2% on accounts under $250,000, 1.5% on accounts between $250k and $1 million, and 1% on accounts over $1 million. Call us for a portfolio evaluation and more information. (760)736-8258. Bill Gunderson has also forged a relationship with Stepstone Partners that gives him access to products that the average investor does not have access to. Call for more information. 13

Bill Gunderson is also columnist for The Street.com, MarketWatch.com, and SeekingAlpha.com I mentioned my article previously for Marketwatch this week on inverse fund. I also wrote an article earlier in the week for The Street on my valuation of Facebook.com: http://www.thestreet.com/story/11550217/1/buy-facebook-wait-until-next-year.html?cm_ven=googlen I currently have 2,788 stocks in my database. Every day when I am done doing my radio show, I spend several hours looking at them. I especially focus in on the ones I own, the stocks rising in rank, and the A- or better rated stocks (usually the top 200). My proprietary grading system consists of Value, Performance, and Safety. I like stocks that have performed much better than the rest, and still offer good value. I spent years developing this grading system and I am thrilled with the results! When it comes to growth stocks, I pretty much stay within the top 200. I do dip down lower than that when it comes to income stocks, however. Here is my weekly example of what I am talking about 14

Bill Gunderson s Weekly Top 200 List. These are the stocks that currently possess the best combination of performance and value. This is a great shopping list! This list represents the top 7% of the entire market. 15

GUNDERSON One Last Best Stocks Now Mo. Ago Week Yest. Current Top 200 5/25/2012 Rank Rank Rank Rank A+ FIRE Sourcefire Inc. 29 4 1 1 A+ LQDT Liquidity Services 3 1 2 2 A+ TSCO Tractor Supply Co 1 15 3 3 A+ PCYC Pharmacyclics Inc 62 10 5 4 A+ DXPE DXP Enterprises Inc 54 5 10 5 A+ DLTR Dollar Tree Stores 18 36 4 6 A+ MNST Monster Beverage Co. 32 2 6 7 A+ BOM Base Metal Index Inverse 2X 236 64 7 8 A+ FXP China Double Short 2249 3 8 9 A+ MDVN Medivation 20 6 9 10 A SBH Sally Beauty Holdings 19 46 11 11 A CHSI Catalyst Health Solutions 36 7 22 12 A EEV ProShares Ultra Short MSCI Emerging Markets 1942 11 17 13 A EFU ProShares Ultra Short MSCI EAFE 1943 19 18 14 A EUO Euro Vs. Dollar Inverse 2X 1781 171 19 15 A YXI China 25 Inverse 2113 12 20 16 A SLXP Salix Pharmaceuticals Ltd 104 34 13 17 A AVD American Vanguard Corp 53 63 14 18 A CERN Cerner Corp 65 30 15 19 A CRUS Cirrus Logic Inc 451 32 27 20 A INCY Incyte Corp 757 31 29 21 A ORLY O'Reilly Automotive Inc 24 24 23 22 A REGN Regeneron Pharmaceuticals 23 14 24 23 A EWV ProShares Ultra Short MSCI Japan 2378 43 58 24 A SCO Crude Oil Inverse 2X 2112 45 33 25 A CMD Commodity Index Inverse 2X 471 123 26 26 A LL Lumber Liquidators 4 37 39 27 A NATH Nathan's Famous Inc 194 106 70 28 A DG Dollar General Corp 298 148 28 29 A ROST Ross Stores Inc 67 21 42 30 A ABCO Advisory Board Company 309 26 41 31 A LPSN LivePerson Inc 66 68 76 32 A BMRN BioMarin Pharmaceutical 250 55 35 33 A EQIX Equinix Inc 71 113 38 34 A PII Polaris Industries Inc 4 18 16 35 A QCOR Questcor Pharmaceutical 10 20 73 36 A VSI Vitamin Shoppe Inc. 370 56 31 37 A NEU Newmarket Corp. 631 263 51 38 A HIBB Hibbett Sporting Goods Inc 33 58 37 39 A OSIS OSI Systems Inc 113 27 44 40 A ALLT Allot Communications 9 102 40 41 A ALXN Alexion Pharmaceuticals 27 76 43 42 A JBHT Hunt JB Trans Scvcs Inc 46 149 46 43 A PETM Petsmart Inc 145 121 50 44 A UA Under Armour 99 101 48 45 A EPV Europe Inverse 2X 2111 41 56 46 A EUM ProShares Short MSCI Emerging Markets 1780 42 57 47 A JPX Pacific Index Japan Inverse 2X 2617 120 105 48 A- CLB Core Laboratories NV 34 25 45 49 A- SXCI S X C Health Solutions 5 23 71 50 16

GUNDERSON One Last Best Stocks Now Mo. Ago Week Yest. Current Top 200 5/25/2012 Rank Rank Rank Rank A- VVUS Vivus Inc 17 13 25 51 A- SWI Solarwinds Inc. 170 8 59 52 A- ZAGG Zagg Inc. 350 233 36 53 A- AGNC American Capital Agency 136 115 60 54 A- TDG Transdigm Group Inc 11 47 32 55 A- WFM Whole Foods Market 305 111 77 56 A- ARIA Ariad Pharmaceuticals Inc 271 38 34 57 A- BIIB Biogen Idec Inc 276 52 52 58 A- LF LeapFrog Enterprises Inc 135 40 67 59 A- AKRX Akorn Inc. 360 35 62 60 A- EW Edwards Lifesciences Corp 184 51 49 61 A- AIRM Air Methods Corp 138 28 65 62 A- GNC G N C Holdings 55 9 12 63 A- ELGX Endologix Inc 117 22 68 64 A- AAPL Apple Computer 21 74 30 65 A- AZZ AZZ Inc 322 66 63 66 A- FL Foot Locker Inc 185 144 74 67 A- BBBY Bed Bath & Beyond Inc 181 91 69 68 A- PCLN Priceline.com Inc 42 60 54 69 A- TJX TJX Co Inc 41 71 64 70 A- ALGN Align Tech Inc 93 70 85 71 A- GEOI GeoResources Inc 144 17 21 72 A- ULTI Ultimate Software 158 53 61 73 A- VRTX Vertex Pharmaceuticals 1288 49 72 74 A- EFZ Europe EAFE Inverse 1779 65 104 75 A- SBM Basic Material Inverse 1944 44 106 76 A- CNQR Concur Technology 433 110 75 77 A- ULTA Ulta Salon 369 414 66 78 A- PAG Penske Automotive Group 36 78 78 78 A- AFSI Amtrust Fin. Svcs. 334 84 78 79 A- PZZA Papa John's International Inc 768 77 86 80 A- PVD Admin Fondos 98 80 223 81 A- FDO Family Dollar Stores Inc 31 87 80 82 A- ABAX Abaxis Inc 1099 54 88 83 A- TDC Teradata 179 180 79 84 A- IMGN Immunogen Inc 1338 179 81 85 A- HSTM Healthstream 8 50 171 86 A- BGS B & G Foods 733 237 113 87 A- WYN Wyndham Worldwide Corp 89 93 47 88 A- TLT Treasuries U S 20 year 436 69 110 89 A- ADGF Adams Golf 58 72 96 90 A- CASY Casey's General Stores Inc 311 107 122 91 A- RDWR Radware Limited 64 61 83 92 A- ADES A D A ES Corp. 118 205 95 93 A- AMZN Amazon.com Inc 800 29 94 94 A- BOS Base Metal Index Inverse 1101 245 55 95 A- DDG Oil & Gas Index Inverse 1778 85 103 96 A- AMT American Tower Corp 242 103 82 97 A- HMSY HMS Hldgs Corp 393 381 123 98 A- CHD Church & Dwight Co Inc 244 78 87 99 A- ARBA Ariba Inc 228 90 97 100 17

GUNDERSON One Last Best Stocks Now Mo. Ago Week Yest. Current Top 200 5/25/2012 Rank Rank Rank Rank A- CRAY Cray Inc 2237 96 114 101 A- ISRG Intuitive Surgical 13 83 108 102 A- BWLD Buffalo Wild Wings Inc 116 126 53 103 A- PRGO Perrigo Co 72 124 131 104 A- SGEN Seattle Genetics Inc 397 98 92 105 A- SWM Schweitzer-Mauduit Intl 214 73 84 106 A- ENB Enbridge 96 81 93 107 A- TTC Toro Co 233 314 112 108 A- NTES Netease.Com Inc Adr 90 79 90 109 A- ARG Airgas Inc 75 127 111 110 A- CPHD Cepheid 172 283 98 111 A- ACC Amer. Campus Comm. 248 150 136 112 A- CMG Chipotle Mexican Grill 141 200 118 113 A- SBUX Starbucks Corp 61 140 102 114 A- SCVL Shoe Carnival Inc 1109 75 125 115 A- BFA Brown Forman Corp Cla 259 97 116 116 A- AZO AutoZone Inc 70 82 130 117 A- MIDD Middleby Corp 528 138 89 118 A- FDS Factset Research Sys Inc 308 173 157 119 A- FMX Fomento Econ Mex Sab Ads 40 67 127 120 A- DTLK Datalink Corp 713 33 159 121 A- PPG P P G Industries 146 129 91 122 A- HE Hawaiian Electric Inds Inc 274 167 138 123 A- KSM DWS Strategic Municipal Income Trust 210 175 165 124 A- KTF DWS Municipal Income Trust 268 202 166 125 A- NVO Novo Nordisk A/S 15 88 132 126 A- CALM Cal-Maine Foods Inc 450 112 117 127 A- VRSK Verisk Analytics 152 86 107 128 B+ ADS Alliance Data Systems Corp 76 163 144 129 B+ SBAC SBA Communications Corp 160 214 101 130 B+ CSGP Costar Grp Inc 481 273 99 131 B+ MHD BlackRock MuniHoldings Fund Inc. 269 176 153 132 B+ DCI Donaldson Company Inc 278 373 137 133 B+ MGAM Multimedia Games Inc 424 134 163 134 B+ PNRA Panera Bread 196 170 100 135 B+ HTWR Heartware Intl. Inc. 1 206 164 136 B+ AH Acccretive Health 1668 676 766 137 B+ DISCA Discovery Holding Co. 50 313 196 138 B+ ZUMZ Zumiez 470 159 128 139 B+ JBSS Sanfilippo John B & Son 154 105 135 140 B+ WRLD World Acceptance Corp 1075 122 172 141 B+ AN AutoNation Inc 814 360 187 142 B+ CBE Cooper Ind Ltd. 645 970 156 143 B+ SHW Sherwin-Williams Co 143 217 148 144 B+ TYL Tyler Technologies Inc 45 89 149 145 B+ FLXS Flexsteel Ind Inc 25 137 150 146 B+ NDSN Nordson Corp 195 453 134 147 B+ PSMT PriceSmart Inc 137 117 200 148 B+ RAVN Raven Ind 258 135 152 149 B+ TCBI Texas Captial Bancshares 415 152 155 150 18

GUNDERSON One Last Best Stocks Now Mo. Ago Week Yest. Current Top 200 5/25/2012 Rank Rank Rank Rank B+ SAM Boston Beer Company 590 329 158 151 B+ VFC VF Corp 82 282 140 152 B+ DORM Dorman Products Inc 110 16 170 153 B+ ODFL Old Dominion Freight Lines 37 199 143 154 B+ MWIV M W I Veterinary Supply 74 94 124 155 B+ HPS John Hancock Preferred Income III 132 154 185 156 B+ COO Cooper Companies Inc 119 131 161 158 A- SFK Russell 1000 Growth Index Inverse 2X 2797 159 159 159 B+ NKE Nike Inc Cl B 232 225 162 159 B+ RHT Red Hat Inc. 26 119 139 160 B+ MNP Western Asset Municipal Partners Fund Inc 290 151 160 161 B+ CMN Cantel Medical 444 303 126 162 B+ EGHT Eight by Eight Inc. 0 189 119 163 B+ SCL Stepan Co 331 264 147 164 B+ HAIN Hain Celestial Grp 312 183 175 165 B+ NRCI National Research Corp 163 59 204 166 B+ CONN Conns Inc 320 539 195 167 B+ RAI Reynolds American Inc 430 363 274 168 B+ UNP Union Pacific Corp 162 146 121 169 B+ YUM Yum! Brands Inc 83 181 179 170 B+ IIC Morgan Stanley California Insured Municipal Inc 510 185 227 171 B+ CMO Capstead Mortg. 191 215 177 172 B+ RGR Sturm, Ruger & Co. Inc 6 132 203 173 B+ HCSG Healthcare Services Grp Inc 87 196 181 174 B+ WWW Wolverine World Wide Inc 939 220 217 175 B+ EXPO Exponent Inc 374 209 145 176 B+ AME Ametek Inc 272 165 120 177 B+ NLY Annaly Capital 323 271 240 178 B+ OKE Oneok 406 116 146 179 B+ EZCH Ezchip Semiconductor 97 227 208 180 B+ MCRS Micros System Inc 288 251 151 181 B+ TRLG True Religion Apparel Inc 916 254 211 182 B+ TGH Textainer Group 542 39 212 183 B+ V Visa Inc. 80 292 129 184 B+ IT Gartner Inc Cl A 177 128 178 185 B+ MMS Maximus Inc 608 193 214 186 B+ BBSI Barrett Business Svcs 467 177 261 187 B+ FAST Fastenal Co 235 190 180 188 B+ WDFC WD 40 Co 699 210 183 189 B+ DSW D S W Inc. 384 300 222 190 B+ ICS Morgan Stanley Insured California Municipal Se 756 238 286 191 B+ MUH BlackRock MuniHoldings Fund II Inc. 261 104 194 192 B+ AMRN Amarin Corp. 1497 372 310 193 B+ CATM Cardtronics 1058 95 207 194 B+ AFFY Affymax Inc. 760 184 193 195 B+ MCA BlackRock MuniYield California Insured Fund In 317 161 262 196 B+ NQC Nuveen California Investment Quality Municipal 282 162 263 197 B+ VLT Van Kampen High Income Trust II 78 169 154 198 B+ EC Ecopetrol 49 136 202 199 B+ BAP Credicorp Ltd 81 246 238 200 19

Bill Gunderson s Top 200 is a new feature in the newsletter. I can tell you from experience that it is very powerful. The Top 200 is a reflection of the market and the economy. These trends can remain in place for a long time. Sometimes bonds are at the top, sometimes cash is at the top, and there are even times when inverse funds rule the roost. Study this list carefully each week. SPECIAL NOTE: AM1000 KCEO HAS BEEN SOLD. WE HAVE MOVED TO AM1450 AND AM1510. You can also tune in on your smartphone or the internet. Global Markets as of 5/25/2012 The global markets have been coming unraveled with the problems in Europe. I would not have any international exposure. 2012 ytd Vietnam VNM 27.4% Thailand THD 9.4% Peru EPU 8.2% Mexico India EWW INP 2.4% 1.2% Japan EWJ -3.3% Europe Emerging Mkts. China EFA ADRE -2.8% -4.4% FXI -6.5% Canada Chile EWC CH -4.0% -6.1% Russia RSX -9.3% Brazil EWZ -9.1% Italy EWI -13.3% Spain EWP -24.4% Greece GREK -23.5% 20

Commodities as of 5/25/2012 COMMODITIES-Still no reason to own commodities right now. 2012 YTD Silver SLV 2.6% Grains JJG 1.3% Gold GLD 0.5% Copper JJC -0.2% Steel SLX -9.9% Oil USO -10.2% Cotton BAL -19.1% Coal KOL -21.6% Watch for Bill Gunderson on: 21

Here are snippets on all of the stocks I have talked about on my radio show, and articles that I have written over the last few months. They are in alphabetical order. http://pwstreet.com/good-bad-stocks/ 2012 Conservative Growth Model Portfolio Sells Bought Bought Bought Sector Buy Price Shares Tot. Buy Sell Price Total Sell Pct. G?L Sell Date 1 27-May-11 VIV Telefonica Brasil Utility $27.96 158 $4,418 $27.79 $4,391-0.6% 3-Feb-12 2 19-Nov-10 ARLP Alliance Res. Ptrs. Commodities $57.92 93 $5,387 $72.44 $6,737 25.1% 2-Mar-12 3 10-Jun-11 KOF Coca Cola Femsa Consumer $88.13 52 $4,583 $101.16 $5,260 14.8% 9-Mar-12 4 21-Oct-11 MCD McDonalds Consumer $91.63 49 $4,490 $95.60 $4,684 4.3% 23-Mar-12 5 6-Nov-08 KMP Kinder Morgan Energy $43.10 55 $2,371 $82.32 $4,528 91.0% 30-Mar-12 6 13-Jan-12 EOG E O G Resources Energy $103.04 46 $4,740 $109.18 $5,022 6.0% 6-Apr-12 7 6-Nov-08 O Realty Income REIT $16.68 130 $2,168 $37.50 $4,875 124.8% 6-Apr-12 8 6-Jan-12 AAPL Apple Computer Technology $422.40 2 $845 $608.90 $1,218 44.2% 13-Apr-12 9 7-Jan-11 PCLN Priceline.com Consumer $440.59 6 $2,644 $742.13 $4,453 68.4% 13-Apr-12 10 13-Jan-12 CELG Celgene Medical $72.63 64 $4,648 $73.45 $4,701 1.1% 27-Apr-12 11 30-Mar-12 BIDU Baidu Technology $145.77 33 $4,810 $134.60 $4,442-7.7% 27-Apr-12 12 12-Aug-11 TNH Terra Nitrogen Commodities $165.98 27 $4,481 $237.40 $6,410 43.0% 4-May-12 13 22-Apr-11 ABV Comp de Bebida Consumer $31.07 144 $4,474 $39.67 $5,712 27.7% 11-May-12 14 21-Oct-11 GWW Grainger Industrial $167.03 27 $4,510 $186.29 $5,030 11.5% 18-May-12 15 27-Apr-12 EC Ecopetrol Energy $63.13 62 $3,914 $57.42 $3,560-9.0% 25-May-12 16 22-Apr-11 FMX Fomento Econ Mex Consumer $62.48 72 $4,499 $78.41 $5,646 25.5% 25-May-12 2012 Income Model Portfolio Sells Bought Bought Bought Sector Buy Price Shares Tot. Buy Sell Price Total Sell Pct. G?L 1 5-Aug-11 CEF Central Fund Canada Pr. Metals $23.93 209 $5,001 $19.97 $4,174-16.5% 4 5-Aug-11 ARLP Allliance Res. Ptr. Energy $69.34 72 $4,992 $61.09 $4,398-11.9% 2 5-Aug-11 TSU T I M Participaco Telcom $26.78 186 $4,981 $28.21 $5,247 5.3% 3 5-Aug-11 NLY Annaly Mortgage REIT $17.53 285 $4,996 $16.17 $4,608-7.8% 4 30-Sep-11 NUV Nuveen Muni Val. FundMuni Bond $9.73 407 $3,960 $9.79 $3,985 0.6% 5 11-Nov-11 BCE B C E Inc. Telcom $39.32 104 $4,089 $39.81 $4,140 1.2% 21 5-Aug-11 TNH Terra Nitrogen Commodity $160.50 31 $4,976 $238.65 $7,398 48.7% 14 5-Aug-11 VIV Telefonica Brasil Telcom $29.78 168 $5,003 $27.64 $4,644-7.2% 10 5-Aug-11 TU Telus Corp. Telcom $50.60 99 $5,009 $57.96 $5,738 14.5% HAPPY MEMORIAL DAY! 22

Gunderson Aggressive Growth Model Portfolio Sells 2012 Symbol Name Sector Bought Buy Price Shares Tot. Buy Sell Price Total Sell Pct. G/L Sell Date 1 BJRI B J Restaurants Consumer 22-Apr-11 $46.56 98 $4,563 $45.99 $4,507-1.2% 6-Jan-12 2 EGOV N I C Inc. Technology 28-Oct-11 $14.23 317 $4,511 $11.92 $3,779-16.2% 3-Feb-12 3 WRLD World Acceptance Financial 30-Dec-11 $73.50 59 $4,337 $65.48 $3,863-10.9% 10-Feb-12 4 RDEN Elizabeth Arden Consumer 28-Oct-11 $35.13 128 $4,497 $39.23 $5,021 11.7% 17-Feb-12 5 DG Dollar General Consumer 30-Sep-11 $37.76 118 $4,456 $42.23 $4,983 11.8% 17-Feb-12 6 HEK Heckman Corp. Energy 18-Dec-11 $6.74 648 $4,368 $5.19 $3,363-23.0% 2-Mar-12 7 SMP Standard Motor Prod. Automotive 23-Dec-11 $20.73 211 $4,374 $20.65 $4,357-0.4% 9-Mar-12 8 LKQX L K Q Corp. Consumer 7-Oct-11 $26.79 169 $4,528 $31.68 $5,354 18.3% 9-Mar-12 9 MNRO Monroe Muffler Consumer 10-Feb-12 $44.24 90 $3,982 $41.85 $3,767-5.4% 23-Mar-12 10 QSII Quality Systems Medical 26-Aug-11 $44.22 97 $4,289 $42.38 $4,111-4.2% 23-Mar-12 11 NUS Nu Skin Enterprises Consumer 40767 39.58 60 2374.8 58.57 3514.2 48.0% 6-Apr-12 12 CLH Clean Harbors Energy 8-Apr-11 $51.78 84 $4,350 $66.33 $5,572 28.1% 6-Apr-12 13 NUS Nu Skin Enterprises Consumer 12-Aug-11 $39.58 60 $2,375 $56.79 $3,407 43.5% 6-Apr-12 14 DPZ Domino's Pizza Consumer 16-Sep-11 $28.28 170 $4,808 $35.14 $5,974 24.3% 13-Apr-12 15 GEOI Georesources Energy 3-Feb-12 $32.13 142 $4,562 $30.74 $4,365-4.3% 13-Apr-12 16 PETM Petsmart Consumer 21-Oct-11 $47.41 95 $4,504 $56.55 $5,372 19.3% 13-Apr-12 17 AAPL Apple Comp. Technology 5-Mar-10 $218.95 3 $657 $614.41 $1,843 180.6% 13-Apr-12 18 ALXN Alexion Pharm. Medical 26-Aug-11 $54.68 27 $1,476 $89.70 $2,422 64.0% 13-Apr-12 19 PCLN Priceline.com Leisure 29-Oct-11 $376.23 4 $1,505 $736.19 $2,945 95.7% 13-Apr-12 20 FCFS First Cash Financial Financial 1-Apr-11 $38.61 110 $4,247 $38.99 $4,289 1.0% 20-Apr-12 21 TPX Tempur Pedic Consumer 6-Apr-12 $85.80 50 $4,290 $59.59 $2,980-30.5% 27-Apr-12 22 PIR Pier One Imports Consumer 6-Jan-12 $15.00 286 $4,290 $17.87 $5,111 19.1% 4-May-12 23 VLTR Volterra Semiconductor Technology 17-Feb-12 $31.88 128 $4,081 $30.51 $3,905-4.3% 4-May-12 24 TYL Tyler Technologies Technology 14-Oct-11 $28.33 160 $4,533 $37.38 $5,981 31.9% 11-May-12 25 PEET Peet's Coffee Consumer 20-May-11 $48.55 83 $4,030 $64.00 $5,312 31.8% 11-May-12 26 ACFN Acorn Energy Energy 30-Mar-12 $10.87 355 $3,859 $9.10 $3,231-16.3% 18-May-12 27 RGR Sturm Ruger Leisure 11-May-12 $50.21 98 $4,921 $42.49 $4,164-15.4% 18-May-12 28 BWLD Buffalo Wild Wings Consumer 2-Mar-12 $87.07 38 $3,309 $82.31 $3,128-5.5% 18-May-12 29 STX Seagate Technology Technology 17-Feb-12 $26.87 152 $4,084 $25.99 $3,950-3.3% 25-May-12 30 PCLN Priceline.com Leisure 29-Oct-11 $376.23 7 $2,634 $656.00 $4,592 74.4% 25-May-12 MORTGAGE RATES remain at all-time lows. "Craig Brock, our local mortgage expert and bond market commentator on Positively Wall Street is actually closing HARP-2 loans for people (while many banks are hopelessly backlogged). Are you under water on your property? These new rules are helping folks who may not have otherwise qualified for a new loan at these historic low rates! Talk to Craig! (855) 900-EASY" Scott Voak, our show s Real Estate expert continues to find double-digit returns on income properties all throughout San Diego. You can reach Scott at (888)311-6311. Scott s website is http://www.voakhomes.com I covered a lot of interesting topics on my daily radio this past week. To listen to the archives, you can visit http://www.pwstreet.com/radio-show-archives To order my book, Best Stocks Now, click the link below: http://pwstreet.com/book/ To set up and appointment with me, click the link below: http://pwstreet.com/contact-us/ 23

If you are looking for a good CPA to do some tax-planning or financial planning, give Randy Goodsell a call. Randy has been my CPA for many years. Randy is a frequent guest on my daily radio show. Randy can be reached at (619)238-4343. His website is http://www.goodsellcpa.com Subscriptions to this weekly newsletter are $195 per year or $60 per quarter. To subscribe call us at (760)736-8258 or visit our website at http://pwstreet.com. You can also mail a check to Gunderson Capital Mgt. 550 Seagaze Dr. #16 Oceanside, CA 92054. THIS REPORT PROVIDES GENERAL INFORMATION AND IS NOT AN OFFER TO BUY OR SELL ANY SECURITY. IT IS THE SOLE OPINION OF THE WRITER, BILL GUNDERSON. BILL GUNDERSON IS PRESIDENT OF GUNDERSON CAPITAL MANAGEMENT INC. A REGISTERED INVESTMENT ADVISORY FIRM LOCATED AT 550 SEAGAZE DR. #16 OCEANSIDE, CALIFORNIA 92054 PHONE NO. (760)736-8258. BILL GUNDERSON EDITS THE WEEKLY NEWSLETTER. INFORMATION IN THIS NEWSLETTER COMES FROM INDEPENDENT SOURCES BELIEVED TO BE RELIABLE, BUT ACCURACY IS NOT GUARANTEED. BILL GUNDERSON OR GUNDERSON CAPITAL MGT. INC. HAS NOT VERIFIED THE ACCURACY OF THE INFORMATION PUBLISHED BY THE INDEPENDENT SOURCES. SELECTIONS IN THIS NEWSLETTER ARE THE SOLE OPINIONS OF BILL GUNDERSON AND ARE SUBJECT TO RISKS AND UNCERTAINTIES BEYOND THE CONTROL OF BILL GUNDERSON AND GUNDERSON CAPITAL MGT. INC. SUCH RISKS AND UN- CERTAINTIES INCLUDE NATIONAL, INTERNATIONAL, ECONOMIC CONDITIONS AND FLUCTUATIONS; ECONOMIC CONDITIONS OF SPECIFIC SECTORS AND GROUPS AND COMPANIES; MANAGEMENT CAPABILITIES OF COMPANIES SELECTED. SELECTIONS IN THIS NEWSLETTER MAY NOT YIELD PROFITABLE RESULTS AND MAY ACTUALLY RESULT IN A LOSS OF INVESTMENT CAPITAL. AS AN INVEST- MENT ADVISORS, BILL GUNDERSON, OR CLIENTS OF GUNDERSON CAPITAL MGT. INC. MAY PURCHASE AND SELL SECURITIES IDENTIFIED EITHER IN THEIR OWN ACCOUNTS OR ACCOUNTS THAT THEY MANAGE. THEY MAY ALSO BUY OR SELL SECURITIES MENTIONED WITHOUT NOTICE TO NEWSLETTER SUBSCRIBERS. IF YOU HAVE ANY QUESTONS, YOU CAN CONTACT BILL GUNDERSON AT (760)736-8258 MENT ADVISORS, BILL GUNDERSON, OR CLIENTS OF GUNDERSON CAPITAL MGT. INC. MAY PURCHASE AND SELL SECURITIES IDENTIFIED EITHER IN THEIR OWN ACCOUNTS OR ACCOUNTS THAT THEY MANAGE. THEY MAY ALSO BUY OR SELL SECURITIES MENTIONED WITHOUT NOTICE TO NEWSLETTER SUBSCRIBERS. IF YOU HAVE ANY QUESTONS, YOU CAN CONTACT BILL GUNDERSON AT (760)736-8258 24