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June 6, 2012

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NCI Building Systems (NCS,$NCS) and other Shorts Lead way for VE MNS Newsletter It is shaping up to be another good month for the short-side selections of our VE Forecast 16 Market Neutral Strategy Newsletter. Currently, our short side is up almost 5% and eleven of the 32 picks are near or exceeding gains of 10%. Jinko Solar still leads the way with a gain of 22% but another strong performer among the primary selections is NCI Building Systems (NCS). Since inclusion on May 17th, NCI has declined in price from $10.43/share to $9.08/share. That represents a short gain of almost 13%. NCI Building Systems, Inc. is a manufacturer and marketer of metal products for the non-residential construction industry. The Companys range of products is used in repair, retrofit and new construction activities, primarily in North America. It provides metal coil coating services for commercial and construction applications, servicing both internal and external customers. It designs, engineers, manufactures and markets lines of metal components and engineered building systems in the industry. It consists of a family of companies operating 31 manufacturing facilities spanning the United States and Mexico. It operates in three business segments: metal coil coating, metal components and engineered building systems. ValuEngine has issued a STRONG SELL recommendation for NCI BLDG SYSTEM on Jun. 06, 2012. Based on the information we have gathered and our resulting

research, we feel that NCI BLDG SYSTEM has the probability to UNDERPERFORM average market performance for the next year. The company exhibits UNATTRACTIVE market valuation and 5-year annualized return. Based on available data as of Jun. 06, 2012, we believe that NCS should be trading at $2.27. This makes NCS 300.00% overvalued. Fair Value indicates what we believe the stock should be trading at today if the stock market were perfectly efficient and everything traded at its true worth. For NCS, we base this on actual earnings per share (EPS) for the previous four quarters of -$1.19, forecasted EPS for the next four quarters of $0.35, and correlations to the 30- year Treasury bond yield of 2.62%.

ValuEngine Forecast
Target Price Expected Return -2.25% -5.87% -12.10% -19.19% -17.38% -18.12%

1-Month 3-Month 6-Month 1-Year 2-Year 3-Year

8.88 8.55 7.98 7.34 7.5 7.43

Valuation & Rankings


Valuation 1-M Forecast Return 12-M Return Sharpe Ratio 5-Y Avg Annual Return Volatility Expected EPS Growth Market Cap (billions) Trailing P/E Ratio Forward P/E Ratio PEG Ratio Price/Sales Market/Book Beta Alpha 300.00% overvalued -2.25% -11.24% -0.76 -66.04% 86.35% 129.31% 0.19 n/a 26.07 n/a 0.18 n/a 2.16 -0.09 Valuation Rank 1-M Forecast Return Rank Momentum Rank Sharpe Ratio Rank 5-Y Avg Annual Rtn Rank Volatility Rank EPS Growth Rank Size Rank Trailing P/E Rank Forward P/E Ratio Rank PEG Ratio Rank Price/Sales Rank Market/Book Rank Beta Rank Alpha Rank 3 7 54 10 8 18 89 51 14 11 n/a 89 n/a 13 56

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Market Overview
Summary of VE Stock Universe
Stocks Undervalued Stocks Overvalued Stocks Undervalued by 20% Stocks Overvalued by 20% 78.63% 21.37% 40.96% 8.84%

Sector

Change

MTD

YTD

Valuation

Last 12M Return


-15.88% -21.19% -35.88% -9.45% -17.37% -15.28% -9.92% -9.70% -4.40% -17.69% -15.72% -13.43% -31.05% 2.76% -20.50% -9.44%

P/E Ratio
36.51 17.76 22.85 32.58 36.4 41.07 28.82 17.9 21.55 19.05 27.6 13.4 24.96 25.53 23.53 18.6

Aerospace Auto-Tires-Trucks Basic Materials Business Services Computer and Technology Construction Consumer Discretionary Consumer Staples Finance Industrial Products Medical Multi-Sector Conglomerates Oils-Energy Retail-Wholesale Transportation Utilities

-0.12% 0.73% 1.00% 0.62% 0.75% 0.49% 0.31% 0.08% 0.84% 0.55% 0.76% 0.57% 1.80% 0.54% 0.48% 0.15%

-0.03% 0.00% 0.90% 0.89% 0.49% -0.75% 0.88% -0.11% 0.70% -0.36% 0.86% 0.28% 0.68% 0.84% -0.76% 0.01%

-5.27% -5.14% -10.69% -0.08% 0.49% 5.41% 3.63% 3.43% 7.18% -5.30% 3.65% -1.71% -15.40% 3.83% -0.96% -6.26%

4.15% undervalued 21.21% undervalued 15.87% undervalued 8.08% undervalued 0.63% overvalued 13.99% undervalued 6.70% undervalued 5.19% overvalued 0.93% overvalued 2.77% undervalued 0.28% overvalued 5.37% undervalued 16.21% undervalued 1.36% overvalued 8.83% undervalued 4.91% overvalued

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