Institutional Research - Focus Five

From January 2006 through its final report in November 2011, Gabelli & Company, Inc. published the Focus FiveTM on a quarterly basis to highlight the most compelling investment ideas covered by our institutional research team. The 5 companies were selected based on valuation and the potential for a near-term catalyst. For the six years the report was published, the Focus Five delivered a compounded return of +224.6% vs. a decline of 0.1% for the S&P 500.

Below is a historical summary of the quarterly ideas included in the report. Please note that this report is not affiliated with The Gabelli Focus Five Fund, an open-end mutual fund strategy that was launched in January, 2012. The investment strategy of the Fund is significantly different than the published report. For information on The Gabelli Focus Five Fund, including a prospectus and current performance, please click here.

Historical Performance of Focus Five
Since inception: January 31, 2006

  Holdings Period Focus Five S&P 500
Q4 CCJ, DAN, SWX, XXIA, XYL10/31/11 - 1/31/12 4.81% 4.72%
Q3 ARG, CF, LNCE, TE, YHOO8/2/11 - 10/31/11 5.68% -3.02%
Q2 ASCMA, CEC, CVS, NAV, YHOO5/2/11 - 7/29/11 -10.54%-5.23%
Q1 BLK, ITT, MSG, NFG, NIHD2/01/11 - 4/30/11 2.37%6.03%
Q4 CCO, MSG, NFG, NIHD, PAG11/2/10 - 1/29/11 17.60%8.69%
Q3 DISCA/K, HSNI, LNN, PAG, V8/1/10 - 10/30/10 13.53%7.41%
Q2 HSNI, MJN, AMTD, TIVO, WFT5/1/10 - 7/31/10 -16.83%-8.37%
Q1 CVC, KOF, STZ, MA, ESI2/01/10 - 4/30/10 11.52%10.55%
Q4 STZ, DTV, MA, MICC, SWY11/2/09 - 1/29/10 9.09%3.64%
Q3 HANS, KO, SCG, WAG, WM8/1/09 - 10/30/09 9.48%4.93%
Q2 JNS, LMDIA, MICC, RSG, TKTM5/1/09 - 7/31/09 36.95%19.55%
Q1 ATVI, CFL, FLS, RSG, URS1/31/09 - 4/29/09 15.43%5.57%
Q4 ATVI, FMC, FPL, HANS, TXT10/31/08 - 1/30/09 -7.15%-13.42%
Q3 ARJ, CVC, DISCA, DBD, DPS8/1/08 - 10/30/08 -18.90%-24.70%
Q2 CVC, DISCA, HRLY, IN, USM4/30/08 - 7/31/08 3.76%-9.05%
Q1 BCO, CVC, FLS, TTWO, WMI1/23/08 - 4/29/08 40.1%4.06%
Q4 FLS, LCAPA, NEU, OEH, THQI10/19/07 - 1/22/08 -7.03%-13.1%
Q3 ARJ, BCO, CEM, CMCSA, OEH7/19/07 - 10/18/07 0.45%-0.39%
Q2 CEM, CVC, GFF, HLT, YHOO4/19/07 - 7/18/07 4.17%4.99%
Q1 ATVI, CEM, HLT, TDS, UST1/31/07 - 4/18/07 6.86%3.12%
Q4 ATVI, FMC, NCS, TRB, UST10/11/06 - 1/30/06 4.44%5.50%
Q3 ATVI, FLS, FMC, NCS, WFT7/17/06 - 10/10/06 8.64%9.55%
Q2 CVC, DW, FLS, OII, WLT4/20/06 - 7/16/06 -3.47%-5.84%
Q1 CBS, DW, MDS, OII, WLT1/31/06 - 4/19/06 8.45%2.46%
Inception to Date   224.59% -0.07%

Performance results do not reflect commissions and assume acquisition and disposition on the day prior to the opening of the period and the end of the closing date, respectively, of the Focus Five reports.

If you had invested in the securities above during the period the Focus FiveTM was published, your performance may have been more volatile than that of the S&P500 due to the concentration relative to the S&P 500. The securities in the list might not have been a component of the S&P index. Dividends are considered reinvested.

Gabelli & Company, Inc. ("we or "us") attempts to provide timely, value-added insights into companies or industry dynamics for institutional investors. Our research reports generally contain a recommendation of "buy," "hold," "sell" or "non-rated. We do not undertake to "upgrade" or "downgrade" ratings after publishing a report. We currently have reports on 708 companies, of which 42%, 40%, 3% and 15% have a recommendation of buy, hold, sell or non-rated, respectively. The percentage of companies so rated for which we provided investment-banking services within the past 12 months is 0%, 0%, 0% and 0%.

Ratings - Analysts' ratings are largely (but not always) determined by our "private market value," or PMVTM methodology. Our basic goal is to understand in absolute terms what a rational, strategic buyer would pay for an asset in an open, arms-length transaction. At the same time, analysts also look for underlying catalysts that could encourage those private market values to surface. A Buy rated stock is one that in our view is trading at a meaningful discount to our estimated PMV. We could expect a more modest private market value to increase at an accelerated pace, the discount of the public stock price to PMV to narrow through the emergence of a catalyst, or some combination of the two to occur. A Hold is a stock that may be trading at or near our estimated private market value. We may not anticipate a large increase in the PMV, or see some other factors at work. A Sell is a stock that may be trading at or above our estimated PMV. There may be little upside to the value, or limited opportunity to realize the value. Economic or sector risk could also be increasing.

We prepared this report as a matter of general information. We do not intend for this report to be a complete description of any security or company and it is not an offer or solicitation to buy or sell any security. All facts and statistics are from sources we believe to be reliable, but we do not guarantee their accuracy. We do not undertake to advise you of changes in our opinion or information. Unless otherwise noted, all stock prices reflect the closing price on the business day immediately prior to the date of this report. We do not use "price targets" predicting future stock performance. We do refer to "private market value" or PMV, which is the price that we believe an informed buyer would pay to acquire 100% of a company. There is no assurance that there are any willing buyers of a company at this price and we do not intend to suggest that any acquisition is likely. Additional information is available on request.

As of January 31, 2011 our affiliates beneficially own on behalf of their investment advisory clients or otherwise 7.77% of Madison Square Garden, 7.11% of National Fuel Gas, 1.66% of ITT Corp. and less than 1% of BlackRock, Inc. and NII Holdings. Because the portfolio managers at our affiliates make individual investment decisions with respect to the client accounts they manage, these accounts may have transactions inconsistent with the recommendations in this report. These portfolio managers may know the substance of our research reports prior to their publication as a result of joint participation in research meetings or otherwise. The analysts who wrote this report may receive commissions from our customers' transactions in the securities mentioned in this report. Our affiliates may receive compensation from the companies referred to in this report for non-investment banking securities-related services, or may be soliciting these companies as clients for non-investment banking securities-related services. One of the analysts has an indirect financial interest in, and exercises discretion over an account which holds shares of the above mentioned securities.

G.research, LLC, an institutional research and brokerage firm, is a subsidiary of GAMCO Investors, Inc. (NYSE:GBL). Gabelli & Company is the marketing name for the registered broker dealer G.research, LLC.
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