A Presentation by David Brokate

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• A Presentation by David Brokate
• October 6, 2003

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Presentation Outline

• Company Outline
• Value of Holding
• Company Snapshot
• Current News an Information
• Financial Statements
• Stock Performance
• Earnings and Net Income Estimates
• Trend Analysis and Comparative Analysis
• Ratio Analysis
• Spreadsheet Model Valuations
• Riskgrade Analysis
• Analyst Recommendations
• Conclusion
• Recommendation

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Company Outline

• Ticker ABC
• Sector Healthcare
• Industry Drug Wholesale
• Market New York Stock Exchange
• Market cap 6154.50 (mil)
• 52 week-high 76.95
• 52 week low 45.65
• Recent price 56.71
• Shares outstanding 111.90 (mil)

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Value of Holding

• Number of shares currently held 50
• Date shares were bought 02/04/2002
• Purchase price 63.90
• Total cost of purchase 3195.00
• Recent price/ share 56.71
• Market value of holding 2835.50

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Company Snapshot

• Business Description Wholesale distributor of
  pharmaceutical products and related healthcare
  services and solutions, including
  pharmaceuticals, proprietary medicines,
  cosmetics, toiletries, personal health products,
  sundries and home healthcare supplies and
  equipment.
• Location Valley Forge, PA, USA
• Nations number 1 drug wholesaler

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Current News and Information

• On January 6, 2003, Amerisource Bergen completed
  the purchase of Bridge Medical, Inc. which has
  the industry-leading bedside scanning
  capabilities.
• On January 17, 2003, Amerisource Bergen acquired
  US Bioservices Corporation which is a national
  pharmaceutical services provider.

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Current News and Information (cont.)

• On September 19, 2003, The Wall Street Journal
  reported that the Food and Drug Administration
  and the FBI were looking into allegations that
  Amerisource Bergen illegally diverted
  prescription drugs into a second market to boost
  profits.
• The CEO, R. David Yost, acknowledged that a
  former employee had been engaged in misconduct a
  few years ago but was found quilty to mail fraud.
  He also acknowledged that a former customer
  participated in illegal actions in 2000.
• R. David Yost guaranteed that an investigation
  would vindicate the company.

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Financial Statements

• See Handouts

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Stock Performance (2 yrs)
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Stock Performance (1 yr)
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Stock Performance vs. competitors (1 yr)
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Earnings Estimate
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Net Income Estimate
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Trend Analysis Income Statement
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Comparative Analysis Income Statement
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Trend Analysis Balance Sheet
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Comparative Analysis Balance Sheet
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Ratio Analysis
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Ratio Analysis (cont.)
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Summary of Valuations

• Stock Value Constant Growth Model - 75.48
• Stock Value Variable Growth Model - 13.59
• Stock Value Dividend Earnings Model - 74.66
• Stock Value Price/Earnings Model - 83.74
• Free Cash Flow - 87.55
• Average Stock Value - 67.00
• EVA and MVA - Firm is Creating Shareholder Wealth

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Risk Analysis

• ABCs risk grade is 137.

• 71 of the tickers in the US Market are riskier
  than ABC.

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Analyst Recommendations

• www.morningstar.com
• Strong Buy - 11
• Buy - 1
• Hold - 1
• Sell - 0
• Strong Sell - 0 www.quicken.com

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Conclusion

• New acquisitions could create a unique position
  to control the market.
• The position of the nations 1 drug wholesaler
  going into an older generation era is promising.
• Most of the stock valuations produced a higher
  stock value than the current stock price.

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Recommendation

• Hold 50 shares of AmerisourceBergen