Please help with the 2 questions:

1.) Reading the descriptions, what patterns do you see in the investment rationales? In other words, what type of catalysts motivated our purchase of the stocks?

2.) Financial ratios are cited in the descriptions. What ratios seemed to be most important in our selection process? What were the levels of these ratios that seemed to be our sweet spot? Do any of the ratios seem to be outliers ?

Refer to stock Analysis below:

SANDERSON FARMS 1/10/06 Stock has been beaten down on Katrina impacts and Avian influenza fears. Dark Meat exports slow at year end because of Katrina, Russia nearing import quotas and Avian flu jitters. Barring human-to-human spread, Avian flu should fade as an issue in April/May time frame. New processing facility in GA is increasing capacity and efficiency. Low cost producer in fresh chicken. 2006 cap ex will lower production costs in further processed chicken. Feed costs are being locked in at historically very low levels.Strong balance sheet........essentially no debt. PP/B=1.5, P/CF=5.5, P/S=0.5 Div Yld is 1.8%. SCHNITZER STEEL 9/5/06 As with most steel firms, SCHN has been enjoying good times. Their diversification may help them in bad times. They are vertically integrated with 3 synergystic parts. Auto parts (both full-service and self-service) is a counter- cyclical portion of the business that has good growth opportunities as SCHN consolidates a fragmented industry. These stores provide fodder for the metal recycling business which is well-positioned in port areas and has high barriers to entry. New mega shredders and induction sorting to cull out non ferrous metals should increase productivity. SCHN is the leading exporter of scrap and benefits from China's growth. Lastly, the efficient minimill has a secure supply of scrap, a and produces bar products for the CA & Pacific northwest markets. This stock has the benefit of running with the bulls in an up market (beta=1.46), but more than other steel stocks can have some potential protection from a US downturn via scrap exports and increased demand for autoparts in a recession. The debt level is low (LTD/Cap=13%). P/B=1.5, P/CF=8.0, P/S=0.7. An SEC investigation into payment practices in Asia lead to a new management team in 2005. The company seems to be fully cooperating and has reserves established for a penalty in the $15 million area. "We need to set our course by the stars, not by the light of every passing ship." - Omar Bradley EDO 2/8/07 Murphy's law poster child EDO has missed consensus four consecutive quarters, 6 out of the last 7, and 8 out of the last 11. Sell-side analysts currently rate the stock with 3 buys, 12 holds, and 3 sells. Management has a job to do to restore credibility. Nonetheless, the seeds are sown for a recovery in the company's fortunes. A huge negative in 2006 was the Warlock counter-IED system. Production of Warlock dropped sharply from 2005. Lessened sales and unabsorbed overhead hurt both the topline and margins. In 2007, Warlock is essentially ignored by analysts. Nonetheless, some sales potential remains, and EDO is a strong contender for the next two generations of counter-IED systems (one to receive production funding and one to receive R&D funding). The big ramp up in sales in 2007 should be for a Marine Corps battlefield communications system, TSM. Beyond TSM, EDO has a diverse set of projects spread among all the armed services, intelligence services, and foreign governments. Such diversification helps, but the company is still very subject to volatility from specific projects such as Warlock and TSM. After many misses, management and reporting structure has been substantially revamped in recent quarters. P/B=1.9, P/CF=16, P/S=0.8. nEPS=$1.54, Rel P/E=1.05,g=11%. OIL STATES INTERNATIONAL 9/27/06 Ois has prominent market positions in diverse portions of the North American market. In well-site services they are the number one provider of accommodations and catering in the Canadian Tar Sands region, competing with firms such as Aramark. They also rent tools in the Gulf Coast region and drill in the Permian Basin. In offshore products they are #1 in heavy duty mooring systems for offshore platforms. They are in demand as producers want to strengthen their protection against large hurricanes. They are also #1 in oil country tubular goods. Even considering a normalized earnings level substantially below current earnings, substantial potential return is available. The stock is down 35% from its peak in May. P/B=1.8, P/CF=6.8, P/S=0.8. SANDERSON FARMS 1/10/06 Stock has been beaten down on Katrina impacts and Avian influenza fears. Dark Meat exports slow at year end because of Katrina, Russia nearing import quotas and Avian flu jitters. Barring human-to-human spread, Avian flu should fade as an issue in April/May time frame. New processing facility in GA is increasing capacity and efficiency. Low cost producer in fresh chicken. 2006 cap ex will lower production costs in further processed chicken. Feed costs are being locked in at historically very low levels.Strong balance sheet........essentially no debt. PP/B=1.5, P/CF=5.5, P/S=0.5 Div Yld is 1.8%. SCHNITZER STEEL 9/5/06 As with most steel firms, SCHN has been enjoying good times. Their diversification may help them in bad times. They are vertically integrated with 3 synergystic parts. Auto parts (both full-service and self-service) is a counter- cyclical portion of the business that has good growth opportunities as SCHN consolidates a fragmented industry. These stores provide fodder for the metal recycling business which is well-positioned in port areas and has high barriers to entry. New mega shredders and induction sorting to cull out non ferrous metals should increase productivity. SCHN is the leading exporter of scrap and benefits from China's growth. Lastly, the efficient minimill has a secure supply of scrap, a and produces bar products for the CA & Pacific northwest markets. This stock has the benefit of running with the bulls in an up market (beta=1.46), but more than other steel stocks can have some potential protection from a US downturn via scrap exports and increased demand for autoparts in a recession. The debt level is low (LTD/Cap=13%). P/B=1.5, P/CF=8.0, P/S=0.7. An SEC investigation into payment practices in Asia lead to a new management team in 2005. The company seems to be fully cooperating and has reserves established for a penalty in the $15 million area. "We need to set our course by the stars, not by the light of every passing ship." - Omar Bradley EDO 2/8/07 Murphy's law poster child EDO has missed consensus four consecutive quarters, 6 out of the last 7, and 8 out of the last 11. Sell-side analysts currently rate the stock with 3 buys, 12 holds, and 3 sells. Management has a job to do to restore credibility. Nonetheless, the seeds are sown for a recovery in the company's fortunes. A huge negative in 2006 was the Warlock counter-IED system. Production of Warlock dropped sharply from 2005. Lessened sales and unabsorbed overhead hurt both the topline and margins. In 2007, Warlock is essentially ignored by analysts. Nonetheless, some sales potential remains, and EDO is a strong contender for the next two generations of counter-IED systems (one to receive production funding and one to receive R&D funding). The big ramp up in sales in 2007 should be for a Marine Corps battlefield communications system, TSM. Beyond TSM, EDO has a diverse set of projects spread among all the armed services, intelligence services, and foreign governments. Such diversification helps, but the company is still very subject to volatility from specific projects such as Warlock and TSM. After many misses, management and reporting structure has been substantially revamped in recent quarters. P/B=1.9, P/CF=16, P/S=0.8. nEPS=$1.54, Rel P/E=1.05,g=11%. OIL STATES INTERNATIONAL 9/27/06 Ois has prominent market positions in diverse portions of the North American market. In well-site services they are the number one provider of accommodations and catering in the Canadian Tar Sands region, competing with firms such as Aramark. They also rent tools in the Gulf Coast region and drill in the Permian Basin. In offshore products they are #1 in heavy duty mooring systems for offshore platforms. They are in demand as producers want to strengthen their protection against large hurricanes. They are also #1 in oil country tubular goods. Even considering a normalized earnings level substantially below current earnings, substantial potential return is available. The stock is down 35% from its peak in May. P/B=1.8, P/CF=6.8, P/S=0.8