February 28, 2020

Valuation Guide

Select Sector Indices

This page provides a summary of valuation metrics for the Select Sector Indices and S&P500 which may be
considered when buying or selling a fund tracking these indices.

Price-to-earnings ratio (on 2020E EPS)

30

20.0 21.1
18.2 18.8 19.1 19.0
20 16.5 16.9
14.6 14.6
11.5
10

0
Comm. Services Discretionary Staples Energy Financials Real Estate Health Care Industrials Materials Technology Utilities

Efficiency Metrics* Risk measures: Standard Deviation

Avg. ROE Asset Assets/ Debt/ Prices Earnings Est.
(16-20E) Turnover Equity Equity (3yr Ann.) 2020-21E
Comm. Services 18.4% 0.45x 2.7x 0.88x -- 5.0%
Discretionary 31.4% 1.02x 4.4x 1.94x 15.3% 6.2%
Staples 26.6% 1.15x 3.2x 1.15x 12.2% 1.9%
Energy 6.7% 0.72x 2.0x 0.42x 23.0% 20.2%
Financials 10.0% 0.07x 8.8x 1.43x 17.0% 3.5%
Real Estate 18.4% 0.20x 2.5x 1.21x 11.8% 13.2%
Health Care 24.1% 0.82x 2.8x 0.84x 13.8% 2.9%
Industrials 25.0% 0.71x 4.1x 1.34x 17.3% 5.1%
Materials 13.6% 0.51x 2.2x 0.54x 15.1% 7.7%
Technology 31.1% 0.61x 2.9x 0.82x 16.2% 3.7%
Utilities 11.8% 0.23x 3.9x 1.49x 12.0% 2.1%

*most recent FY available, except averages as noted

Valuation multiples (based on 2020 estimates)

P/E PEG P/CF P/Sales P/BV
Comm. Services 18.2 1.7 11.9 2.5 2.9
Discretionary 20.0 1.8 14.9 1.5 5.8
Staples 18.8 2.8 15.5 1.4 4.8
Energy 14.6 1.5 5.8 0.8 1.2
Financials 11.5 1.3 12.8 2.1 1.2
Real Estate 19.1 2.4 23.1 6.5 3.3
Health Care 14.6 1.6 13.3 1.5 3.2
Industrials 16.5 1.7 13.1 1.6 4.0
Materials 16.9 1.9 11.0 1.6 2.0
Technology 21.1 1.8 17.9 4.7 5.9
Utilities 19.0 3.6 9.7 2.5 2.1

S&P 500 17.0 1.7 13.6 2.1 2.9

Earnings per share growth

40%
2020E 2021E
30%

20%

10%

0%
Comm Svcs Discretionary Staples Energy Financials Real Estate Health Care Industrials Materials Technology Utilities

Note: All valuation metrics on this page calculated based on consensus estimates of current index constituents, as collected by Bloomberg and
FactSet. Definitions of technical terms can be found on page 4 of this document.

© 2020 AltaVista Research, LLC. All Rights Reserved. This report is provided for informational purposes only, and AltaVista makes no warranties with
respect to its accuracy. See Disclosure page for additional disclosures.
 February 28, 2020
Valuation Guide

Select Sector Indices

Trends in P/E and P/BV multiples Consumer Discretionary Select Sector

This page contains monthly observations of historical

25 8.0

P/BV (x)
price-to-earnings (P/E) and price-to-book value (P/BV)

P/E (x)
multiples based on rolling twelve-months' earnings and 20 6.0
book value per share figures, respectively, for each
15
Select Sector Index (maximum value of 100). It 4.0
illustrates how these indices have traded in the recent 10
past in relation to these two valuation metrics. 2.0
5 P/E (left) P/BV (right)
Investors may consider this along with other data and 0 0.0
information when buying or selling any security 2015 2016 2017 2018 2019 2020 2021
tracking these indices.

Consumer Staples Select Sector Energy Select Sector

24 6.0 100 P/E (left) P/BV (right) 3.0

P/E (x)

P/BV (x)
18 5.5 80
2.0
60
12 5.0

P/E (x)
40
P/BV (x)

1.0
6 4.5
P/E (left) P/BV (right) 20
0 4.0 0 0.0
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021
*Note: maximum P/E = 100, may also indicate losses

Financial Select Sector Health Care Select Sector

P/E (x)

P/E (x)

20 2.0 20 5.0

P/BV (x)
P/BV (x)

15 1.5 15 4.0
3.0
10 1.0 10
2.0
5 0.5 5
P/E (left) P/BV (right) P/E (left) P/BV (right) 1.0
0 0.0 0 0.0
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

Industrial Select Sector Materials Select Sector

25 5.0
P/E (x)

20 6.0

P/BV (x)
P/BV (x)

20 4.0
15
4.0
15 3.0
10
10 2.0
2.0
5
P/E (x)

P/E (left) P/BV (right) 5 1.0

P/E (left) P/BV (right)
0 0.0 0 0.0
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

Technology Select Sector Utilities Select Sector

25 8.0 25 2.5
P/E (x)
P/E (x)

P/BV (x)

20 20 2.0
6.0
15 15 1.5
4.0
10 10 1.0
P/BV (x)

5 P/E (left) P/BV (right) 2.0 5 0.5

P/E (left) P/BV (right)
0 0.0 0 0.0
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

© 2020 AltaVista Research, LLC. All Rights Reserved. This report is provided for informational purposes only, and AltaVista makes no warranties
with respect to its accuracy. See Disclosure page for additional disclosures.
 February 28, 2020
Consensus Sentiment

Select Sector SPDRs

Trends in Analysts Consensus Ratings

This page contains historical analysts' consensus ratings on each index's underlying constituents, translated to the following composite
scale: Strong Buy: 80-100 (where 100 means all analysts covering these stocks having a rating of Strong Buy); Buy: 60-80; Hold: 40-60;
Sell: 20-40; and Strong Sell: 0-20. Also shown is each sector's composite rating relative to the S&P 500, which may help investors to
determine whether analyst setiment towards the sector is more bullish or bearish than towards the market in general.

Given the prevalence of Buy ratings among analysts, both the trend and relative ratings may be more important than the rating level in
gauging analysts' true sentiment regarding the stocks in each index. Investors may consider this along with other data and information

Consumer Discretionary Consumer Staples Energy

84 1.08 75 1 80 1.05
Relative (x)

Relative (x)

Relative (x)
Consensus

Consensus

Consensus
82
1.06 0.95 1
80 70 75
78 1.04 0.9 0.95
76 65 70
1.02 0.85 0.9
74
Consensus (left) Relative (right) Consensus (left) Relative (right) Consensus (left) Relative (right)
72 1 60 0.8 65 0.85
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

Financials Health Care Industrials

80 1.05 82 1.1 80 1.05
Consensus

Consensus

Consensus
Relative

Relative

Relative
1 80
75 75 1
(x)

(x)

(x)
78 1.05
0.95
70 76 70 0.95
0.9
74 1
65 65 0.9
0.85 72
Consensus (left) Relative (right) Consensus (left) Relative (right) Consensus (left) Relative (right)
60 0.8 70 0.95 60 0.85
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

Materials Real Estate Technology

80 1.05 78 1.05 85 1.1
Relative (x)

Relative (x)

Relative (x)
Consensus

Consensus

Consensus

76
1 1
75 74 80 1.05
0.95 72 0.95
70 70 75 1
0.9 0.9
68
Consensus (left) Relative (right) Consensus (left) Relative (right) Consensus (left) Relative (right)
65 0.85 66 0.85 70 0.95
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

Utilities Comm. Services S&P 500

72 0.92 84 1.08 78 1.5
Consensus

Consensus
Consensus

Relative

Relative
Relative

70 0.9 82 76
(x)

(x)
(x)

68 1.06 1
0.88
66 80 74
0.86
64 1.04 0.5
78 72
62 0.84
Consensus (left) Relative (right) Consensus (left) Relative (right)
Consensus (left) Relative (right) 76 1.02
60 0.82 70 0
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021

© 2020 AltaVista Research, LLC. All Rights Reserved. This report is provided for informational purposes only, and AltaVista makes no warranties
with respect to its accuracy. See Disclosure page for additional disclosures.
Disclosures
Limitations on Usage
This report is provided by AltaVista Research, LLC (“AltaVista”) for informational purposes only, and is for distribution only as permitted by applicable
law. Any opinions expressed herein are solely those of AltaVista and make no allowances for any specific investment objectives. As such, they do not
constitute a recommendation with respect to the investment merits of any security or index mentioned herein. Nothing in this report should be
construed as an offer or solicitation of an offer to purchase any securities. Prices and valuation data change with market conditions and investors
should be aware that this material could be substantially out of date when distributed. This report may not be reproduced or redistributed, in whole or
in part, without the express written consent of AltaVista.

Data Definitions & Reliability

AltaVista believes the information contained in this report to be reasonably accurate at the time of publication, but makes no warranties with respect
to its accuracy. Calculations of fundamental data are based on a weighted average of consensus estimates and reported results for current index
constituents. As a result, historical figures for fundamental data such as dividends per share may not reflect those actually paid by firms in the index.
To the extent that index reconstitution and rebalancing have altered index composition, these differences may be significant. Definitions for some
commonly used financial terms are as follows:

Sales: Calculated based on consesus revenue results/estimates for the individual constituents of each index.
Earnings/Net Income: Unless denoted as a GAAP figure, earnings are calculated on a “pro forma” basis using consensus EPS
results/estimates for the individual constituents of each index, multiplied by the float-adjusted shares in the index. For Real Estate Investment
Trusts (REITs), the consensus per-share figure for funds from operations, or FFO, is used in place of EPS data.
Sales Growth and Earnings Growth: Year-on-year change in sales or earnings results/estimates in percentage terms.
Net margins: Earnings as a percentage of sales in a given period.
Cash Flow: Adds depreciation and amortization to consensus earnings estimates
Standard deviation: Statistical measure of price volatility using 3 years of monthly return data. Figures are annualized.
Beta: Measures relative volatility of a given sector index versus the S&P500 by comparing 3 years of monthly return data.
Book Value: Common Equity as reported by index constituents according to GAAP. Forecasts reflect pro-forma calculations using most recently
reported figures, plus earnings less dividends.
Dividends per share: Dividends paid by companies in the index on a pro forma basis.
Payout ratio: Dividends as a percentage of Earnings/Net Income in a given year.
Return on Equity: Net income divided by average common equity over the period.
Debt-to-equity: Ratio of long- and short-term debt to owners equity.
Long-term growth: Uses consensus estimates of 3-5 year earnings growth for individual constituents of each index to calculate a float-
adjusted earnings-weighted growth rate for the index as a whole.
Trend in Current FY Estimates: Illustrates changes in consensus estimates over time by examining the monthly change in current fiscal year
EPS estimates for individual constituents of each index. Base period is set equal to 100.
Price-to-Earnings, -Cash Flow, -Sales and -Book Value: Valuation multiples derived by dividing the index price by the per-share figures
How We Rate Indices
For every index under coverage, we calculate a rating based on a proprietary scoring system that analyzes metrics such as Return on Equity and Price-
to-Book Value multiples. Then, we separate the indices into five tiers based on their individual scores. Although one index's score and recommendation
are independent of other indices' rankings, our coverage universe has a roughly normal distribution among the five tiers, with NEUTRAL accounting for
the largest number of indices. The five tiers are as follows:

SPECULATIVE: Deeply undervalued but risky. A rating of SPECULATIVE indicates exceptional appreciation potential in our opinion.
However, firms in this index may also have deep structural issues, which can carry extra risk. The rating is based on a proprietary scoring
system that analyzes metrics such as Return on Equity and Price-to-Book Value multiples.

OVERWEIGHT: Above average appreciation potential. A rating of OVERWEIGHT indicates that stocks in this index are trading at
attractive valuations and/or have above-average fundamentals. The rating is based on a proprietary scoring system that analyzes metrics such
as Return on Equity and Price-to-Book Value multiples.

NEUTRAL: Average appreciation potential. A rating of NEUTRAL indicates that valuations adequately reflect the fundamentals of stocks in
these indices. The majority of indices we cover fall into this category. The rating is based on a proprietary scoring system that analyzes metrics
such as Return on Equity and Price-to-Book Value multiples.

UNDERWEIGHT: Below average appreciation potential. A rating of UNDERWEIGHT indicates that stocks in this index are trading at
relatively expensive valuations and/or have below-average fundamentals. The rating is based on a proprietary scoring system that analyzes
metrics such as Return on Equity and Price-to-Book Value multiples.

AVOID: A rating of AVOID indicates poor appreciation potential, but some indices in this tier consist of stocks for which our
fundamentally-driven analysis may be less relevant, especially for early-stage growth companies. The rating is based on a proprietary scoring
Additional information is available upon request.

©2020 AltaVista Research, LLC. All rights reserved. This report is provided for informational purposes only, and AltaVista makes no warranties with respect to its
accuracy.
SEL004006 Exp 4/30/20