Quantamental Investing to beat Benchmarks

A. Stotz Investment Research

We pick stocks. We construct portfolios. All our effort is focused on how to better pick stocks and construct portfolios. We serve fund management companies, family offices, and high net worth individuals.

CEO, A. Stotz Investment Research

Dr. Andrew Stotz, CFA

Equity Bottom-Up

<ul><li>Cheap on a PE basis, cheap on a gross profit basis, and share price is less volatile relative to its sector</li><li>AUO plans to boost its capacity by 5-7% which is in line with the expected panel demand which should also grow by 5-7% in 2018</li><li>New 10.5 G generation of production line expected to launch in 2018 should boost production capacity of the largest panels of 55” and more; this should boost AUO competitiveness in the high-end segment</li><li>Trades below Asian Info Tech at 18CE* 0.6x PB in line with below sector ROE but offers a solid balance sheet and a nice dividend yield</li><li>Risks: Strong competition from Chinese manufacturers</li></ul><p><em>* Consensus Estimates</em></p>

Cheap on a PE basis, cheap on a gross profit basis, and share price is less volatile relative to its sectorAUO plans to boost its capacity by 5-7% which is in line with the expected panel demand which should also grow by 5-7% in 2018New 10.5 G generation of production line expected to launch in 2018 should boost production capacity of the largest panels of 55” and more; this should boost AUO competitiveness in the high-end segmentTrades below Asian Info Tech at 18CE* 0.6x PB in line with below sector ROE but offers a solid balance sheet and a nice dividend yieldRisks: Strong competition from Chinese manufacturers* Consensus Estimates

AU Optronics

AUO (2409 TT): Going for Bigger Screens