Update on Benelux Universe Roadmap
Mid-November 2008, we published our 550-page Benelux Universe Roadmap and pitched
our ideas for the remainder of 2008/early 2009. Our portfolio was rather defensive because
we feared an armada of profit warnings. We continue to acknowledge significant economic
challenges lie ahead and we believe the impact on corporate earnings will be substantial. Yet
earnings alone do not determine market performance. Equity valuations were driven to
extreme levels in 4Q08, as forced deleveraging overshadowed any appraisal of
fundamentals. We see significant room for multiple expansion to drive returns as risk appetite
normalises over the coming period.
Time to gradually turn more aggressive
We are moving more on the offensive as: 1) Bloomberg consensus is already coming down
to our incorporated levels, improving the risk/reward balance; 2) we are in the midst of the
second recapitalisation round of the financials industry – unfreezing the credit market is a
must for a rerating in equities; 3) since November, the discount between small/midcaps and
large has widened further, from 30% to 40%, close to the historical peak; and 4) companies
are no longer in denial and are adjusting for the new reality (cutting capacity, jobs etc).
From a defensive to a more aggressive portfolio of ideas
Overall return on our portfolio has been some 11% vs an increase of 4% in the AEX index
and a 7% decline in the AMX Index. The biggest contributors were Telenet, Randstad,
Arcelor and KPN. On the risk list, we made a significant 32% return on Arcadis, Boskalis,
Aalberts, Agfa and Solvay. We now start to move to a more aggressive, high-beta portfolio.
On the long side, we keep Telenet, Randstad, Arcelor and Unibail, but add Wavin and
Crucell. We keep Boskalis, Arcadis, Solvay, Agfa on the risk list and add Vopak.

Contents
Update on equity strategy 3
The financial market turmoil in 4Q08 will have exacerbated the deterioration in the
global economy. Yet we believe an aggressive global policy response should
prevent a worst-case outcome. Amid the gloom, we argue equities are strategically
attractive.
Update on multiples analysis 4
In recent months we have seen earnings multiples increase 19% as forecasts came
down while the markets did not. Further, the discount between large caps and
midcaps increased and is now close to its historical peak.
Update on performance 6
Since the publication of the Benelux Universe Roadmap, our picks have risen 11%
vs the AEX index up 4% and the AMX down 7%. We update the list here, now
reflecting a more aggressive bias. Crucell and Wavin are added to the long side and
Vopak to the risk list.
Trading portfolio performance up 11% since November 6
More aggressively biased now 6
Changes to our focus list 7
Summary of ideas 8
We take Ten Cate, Fugro and KPN out of our long list and add Wavin and Crucell.
This underscores our gradual shift from defensive to aggressive. In addition, we
replace Aalberts with Vopak on the risk list.
Wavin – Buy, target price € 8
Crucell – Buy, target price €16 8
Randstad – Buy, target price €21 9
Telenet – Buy, target price €15 9
Arcelor – Buy, target price €23 10
Unibail – Buy, target price €120 10
Vopak – downgraded to Hold from Buy; new target price €31 (from 11
Agfa Gevaert – Sell, target price €2 11
Solvay– Sell, target price €54 12
Boskalis – Hold, target price €27 12
Arcadis – Hold, target price €9 13
Company profiles 14
Crucell 14
Vopak 21
Wavin 36
Benelux equities research team 48
This section provides contact details for all analysts covering Benelux stocks, either
from Amsterdam or London.