67 WALL STREET, New York - November 4, 2009 - The Wall Street Transcript has just published its TWST Small Cap Value Report offering a timely review of the sector to serious investors and industry executives. This 47 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Small-Cap Value - Capital Preservation - Sovereign Bonds - Precious Metals - Value-Investing - Companies with International Exposure - US-listed Chinese Companies - Risk Limitation - Industry-Diversified Portfolios - Long-Term Value - Micro-Cap Companies - Turnaround Situations - Strategic Buying - Fundamental Analysis

Companies include: Bridgepoint Education (BPI); Compass Minerals (CMP); Flexsteel (FLXS); Hardinge Corp (HDNG); Phillips-Van Heusen (PVH); Adobe (ADB); Affiliated Computer Services (ACS); Alliance Data Systems (ADS); American Water Works (AWK); Atlantic Tele-Network (ATNI); Celanese Chemical (CE); CenturyTel (CTL); Clean Energy Fuels (CLNE); Consolidated Graphics (CGX); Dell (DELL); Dillard's Department Stores (DDS); Drew Industries (DW); Educational Development Corporation (EDUC); First Acceptance Corp (FAC); Forestar Group (FOR); Fresh Del Monte (FDP); Hain Celestial (HAIN); Harbin Electric (HRBN); Huron Consulting (HURN); IMAX (IMAX); IMS Health (RX); Kennametal (KMT); Lamar Advertising (LAMR); NBTY (NTY); Nature's Sunshine Products (NATR); Nobility Homes (NOBH); Omniture, Inc. (OMTR); Perot Systems (PER); Pfizer (PFE); SPDR Barclays Capital International Treasury Bond Fund (BWX); SPDR Gold Trust (GLD); Silver Wheaton (SLW); Tellabs (TLAB); Temple-Inland (TIN); Tempur-Pedic (TPX); Tesoro (TSO); Valero (VLO); Verizon Wireless (VZ); Whole Foods (WFMI); Xerox (XRX).

In the following brief excerpt from just one of the interviews in the 47 page report, a top tier money manager discusses his stock picks for investors.

Douglas R. Cannon is the Founder and Chief Investment Officer of Texas First Investment Management Company. He has been the portfolio manager for the Texas First Large Cap Value, Small Cap Value, and All Cap Value portfolios since their start in 2000. Money Manager Review, Barron's, Morningstar, and Pensions & Investments magazine have ranked the Texas First portfolios among the top performers in the country over the past eight years. From 2002 to 2004, he was appointed by the Governor of Texas to serve as the Chairman of the Investment Advisory Committee of the $19 billion Texas Permanent School Fund. From 1989 to 1991, he was Deputy Executive Director of the Pension Benefit Guaranty Corporation, with responsibility for managing $4 billion in pension assets. He has 23 years of investment experience, and began his career as an investment analyst researching Southwest-based stocks for Dallas-based securities firm Rauscher Pierce Securities, Inc. (now part of RBC Dain Rauscher, Inc.). He holds an MBA degree from Harvard Business School and a BS/BBA degree from the Wharton School of Business. He is a Chartered Financial Analyst.

TWST: Tell us about Texas First Investment Management and your value philosophy.

Mr. Cannon: Over the past decade, Texas First Investment Management Company has been one of the top ranked value equity managers in the country. We are ranked Number 1 in the country among all value equity separate account managers for the five-year period ending June 30, 2009. The rankings were done by Morningstar, and published in Pensions & Investments Magazine in their Top Performing Managers article August 24, 2009. The universe there was all equity value managers: large-cap, mid-cap, small-cap and all-cap. We are also ranked the Number 1 mid-cap value manager over that same five-year period ending in June 2009. Our mid-cap value product is known as the Select Value Portfolio. In terms of small-cap, our Small Cap Opportunity portfolio is rated the Number 1 small-cap value equity portfolio in the country for the one-year period ending June 30, 2009 and that is among all separate account managers. That ranking, again, was done by Morningstar for the Pensions & Investments Magazine article.We are long-term value managers. We have an emphasis on risk limitation and industry-diversified portfolios. Investment decisions are based on bottom-up, in-depth fundamental research.

TWST: What is your definition of value? What are the valuation metrics that you look for in these mid and small-cap stocks?

Mr. Cannon: We believe that if you are a value manager, it is very important to buy stocks that are down for some reason and determine if there is a good reason the stock price should recover. The key is not just to find value stocks, but value stocks where the market has not realized their potential for fundamental improvement or stock price appreciation. We are true deep value managers, so we focus on companies that are at the lower end of their one, three and/or five-year price ranges.

TWST: Tell us about your investment criteria. What is the process of choosing the companies that you invest in?

Mr. Cannon: There are two broad areas of investment criteria that we use. One is quantitative measurement, and we have a proprietary database that we have built, refined, and fine-tuned over the years. We have a well-defined universe of stocks, and we tend to know those stocks fairly well. In terms of quantitative measurement, we look at low price to sustainable earnings, low price to sustainable cash flow, low price to book, and low price to the five-year growth rate. In looking at the earnings and cash flow, we believe it's very important to not just look at the current earnings, the past earnings or the projected earnings. We want to look at the sustainable earnings over the long term. True deep-valued companies may have earnings that are down for the time being, but if we've seen that they have a sustainable earnings base that's higher, and then we have a better fix on what the long-term earnings projections should be. In addition to the quantitative measurements we look at, there are some qualitative factors that we focus on. We want to look at companies with managements that are committed to enhancing shareholder value within the near term. We define that as 18 months or so. We like to see management with some ownership in the company and we look very carefully at what the insider transactions have been. Typically you will have management selling stock over some period of time for liquidity and other reasons. But when you see management buying stock at the market price and you see an absence of significant management selling over a period, it's a very good sign that the management is confident that their stock price should be higher. Some of the other things we look for are catalysts, something a company that might do to unleash shareholder value. That could be a corporate restructuring. It could be a company that's a likely acquisition target even though no potential acquisition may have been announced, but the company has indicated it might be open to that possibility.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 47 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

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