Earning Release

Frontline Ltd.'s (NYSE:FRO) 3Q 09 results trailed market expectations due to a steep decline in sea borne trade activity. However, we expect to raise our estimates and target price to incorporate improvement in shipping rates since our last update and hence upgrade our common stock rating from a SELL to a HOLD. We will reassess our NYSE common stock rating for Frontline in our next update report. We continue to anticipate a significant negative currency impact on the Norwegian stock over our 6-12 month investment horizon. Hence we reiterate the Norwegian stock a SELL. We will reassess our Norwegian stock rating for Frontline in our next update report.

News

On 26 November 2009, POSCO (NYSE:PKX)common stock reached our target price. However, our fundamental outlook remains unchanged and we therefore believe that the stock's 6-12 month upside potential has now been exhausted. Accordingly, we downgrade the common stock from a BUY to a HOLD. We will reassess our common stock rating in our next update report. As we continue to anticipate a significant positive currency impact on the ADR over the coming 6-12 months we reiterate the ADR a BUY. We will reassess our ADR (4 ADRs = 1 common share) rating in our next update report.

New Valuations

SAP AG (NYSE:SAP)reported a decline in revenues, while for its cost cutting initiatives, net income reported a sharp increase. SAP expects the operating environment to remain challenging in FY 2009, and therefore has given conservative guidance for the year. SAP's potential customers are still cautious on software spending. Hence outlook the for the company's Business software products is still gloomy despite signs of economic recovery worldwide. In addition, the company's Software maintenance revenues are deteriorating compared to its biggest rival Oracle, which showed growth, despite a decline in business product revenues. The company witnessed some caution on the part of customers, hesitant about entering into large upfront deals. Hence SAP has been taking cost cutting initiatives to safeguard profitability. We expect the Business products segment of the company to continue to see a stagnant performance due to recurring revenues from existing customers. We believe the company is in a strong position to benefit from the anticipated recovery in demand from Emerging Markets. In addition, SAP's large customers such as Apple Inc, Coca Cola Company, Wal Mart Stores, have already seen some signs of stabilization and revenue growth. Moreover the company is also focusing on broader acquisition opportunities after the EUR4.8 bn acquisition of Business Objects last year. Meanwhile, the company has been acquiring small rivals to add software to existing products. Nevertheless taking into account the gloomy outlook for the company's Business product division, at current levels we maintain our HOLD rating on the stock.

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