Sundeep Kutumbaka and George Bocchetti

Buy: Limit at $18Sell: Stop at $20, Limit at $22

Provides tax, banking, accounting and business consulting services and products Prepares 1/7 tax returns Had an office within 5 miles of most

Americans Employs more than 110,000 Has helped clients obtain nearly $30 billion in

tax refunds, credits Founded in 1955 Headquartered in Kansas City, MO

Tax Services = 74.3% of revenue Provides tax return preparation services in Unites

States, Canada, Australia Markets TaxCut income tax preparation software

Business Services = 22% of revenue RSM McGladrey, Inc. (RSM) provides accounting,

tax and business consulting services Consumer Financial Services = 3.5% of

revenue provides retail banking offerings through HRB

Bank

Current Price: $18.08 P/E Ratio: 12.07 Beta: 0.49 Dividend/ Yield: $0.15/

3.32% EPS: $1.50 52-Week Low: $13.73 52-Week High: $25.94 Market Cap: $6.60B Institutional Ownership: 85%Taken from http://www.google.com/finance?q=hrb as of 10/04/09

Loss of $130.6 million, or 39 cents per share Vs. loss of $128.4 million, 39 cents per share a

year before Vs. estimates of loss of 37 cents per share

Typically lose in Q1, Q2 and gain in Q3, Q4 Taxes are seasonal: most revenue from Jan-April

Exacerbated by increase in Tax Services expense

Reaffirmed guidance for FY10 Upgraded September 8th, 4 days after release

Largest provider of tax preparation services in the world

Low in their yearly cycle Just beginning to gain

Respected, trusted brand name Compared to unknown competition

Unstoppable business All adults have to file a tax return

Even small tax changes increase business

Multiple markets: US, Canada, Australia

Multiple businesses: Tax services, tax software, banking,

business consulting Cutting down excess businesses

Investment advisement, subprime mortgages

Trying for new public image Revamped, professional storefront More serious advertising campaign▪ Multiple platforms▪ Shareholders at last meeting applauded demo

ad Reduced prices for low-income, young

clients Honor federal college credits Hiring nearly 15,000 tax professionals

Jackson Hewitt Tax Service, Inc (JTX) Market cap of only 135M Less diversified, smaller client base, smaller

market Downgraded at Oppenheimer in August Drop of 13% in tax return volume in 2009

seasonGilman Ciocia, Inc (GTAX)

Serves mostly middle and upper class Only in New Jersey, New York, and Florida

Intuit, Inc (INC) TurboTax software, but no walk-in offices

Our recommendation: Watch and buy on pull back, at Limit of $15

Sell: Stop at $19, Limit at $22

Designs, manufactures, markets Invisalign A method for treating the misalignment of teeth Alternative to visible, cumbersome braces

Invisalign is regulated by FDA as a Class II medical device

Incorporated in 1997 First sales of Invisalign to orthodontists in

1999 By late 2001, manufactured one million

aligners Headquarters in Santa Clara, CA

The Invisalign system is comprised of ClinCheck: creation of digital treatment plans manufacturing of customized Invisalign aligners

Sells Invisalign directly to consumers, dentists, and/or orthodontists

Also sell retainers, ancillary products Cleaning material, adjustment tools for

Invisalign Operates in North America, Europe, Asia-

Pacific, Latin America, and Japan

Invisalign Full Complete, personal treatment

Invisalign Express Pre-made for various categories of treatment

Invisalign Teen Aligner wear indicator to gauge patient

compliance Retention

Vivera retainers for Invisalign/non-Invisalign patients

Ancillary Products Support Invisalign

To date trained more than 56,700 doctors manufactured more than 44 million unique

Invisalign aligners started more than 1,000,000 patients in

treatment reached $1.5 billion in cumulative net revenues complied IP portfolio of more than 160 patents provides exclusive education events at more

than 60 universities worldwide

Current Price: $15.82P/E Ratio: 13.61Beta: 2.12Dividend/ Yield: N/AEPS: $1.1652-Week Low: $4.8852-Week High: $16.45Market Cap: $1.05B Institutional Ownership: 88%Taken from http://www.google.com/finance?q=algn as of 10/15/09

Q2 Earnings Report released July 232

EPS of $0.072

Compared to estimate of $0.012

Revenue of $76.3 million2

Compared to estimate of $69.4 million2

27% increase in international revenue2

Share price rose 14% after release2

Predicted Q3 earnings in current range2

Year Date ActualLast Avg Estimate

$ Surprise

2009 Jun-09 0.07 0.01 0.06

2009 Mar-09 0.04 -0.02 0.06

2008 Dec-08 0.98 0.02 0.96

2008 Sep-08 0.08 0.02 0.06

2008 Jun-08 0.06 0.05 0.01

2008 Mar-08 0.07 0.02 0.05

On a rallyVaried product lineupMultiple markets

North America, Europe, Asia-Pacific, Latin America, and Japan

Over a million existing clients And growing

Upgraded to Buy at Northcoast on Oct 1 Increase in year-over-year case starts

Buy rating reaffirmed at Brean Murray Recently released new features

Based on customer research and treatment data

Make Invisalign effective for more bite types

Ended patent litigation with Danaher Corporation's Subsidiary Ormco Corporation Exclusive agreement to work on

combination orthodontic product Should lead to an increase in sales

Beat estimates in last 6 earnings reports Will probably beat again on October 22nd

3M Company (MMM) Diversified technology company No specific product that competes with

Invisalign▪ Nothing invisible

DENTSPLY International, Inc (XRAY) A few competitive products▪ Not as extensive a lineup

No marketing▪ Not as well-known

ALGN:1. http://www.reuters.com/finance/stocks/companyProfile?rpc=66&symbol=ALGN.O2. http://www.reuters.com/article/rbssHealthcareNews/idUSBNG538028200907233. http://www.orthodonticproductsonline.com/news/2009-09-24_01.asp4. http://www.marketintelligencecenter.com/articles/9625615. http://online.wsj.com/article/BT-CO-20091001-709097.html6. http://www.reuters.com/finance/stocks/keyDevelopments?rpc=66&symbol=ALGN.O&timestamp=200908171219007. http://finance.aol.com/earnings/align-technology-inc/algn/nas/earnings-release8. http://finapps.forbes.com/finapps/jsp/finance/compinfo/Earnings.jsp?tkr=ALGN9. http://finance.aol.com/charts/align-technology-inc/algn/nas/classic-charts10. http://www.thestreet.com/quote/ALGN/details/earnings-estimates.html11. http://www.aligntech.com/Pages/About.aspx12. http://www.google.com/finance?q=algn

HRB:1. http://www.hrblock.com/company/index.html2. http://www.google.com/finance?q=hrb3. http://www.reuters.com/finance/stocks/companyProfile?symbol=HRB.N&rpc=664. http://finance.aol.com/charts/block-h-and-r-inc/hrb/nys/classic-charts5. http://finance.aol.com/charts/align-technology-inc/algn/nas/classic-charts 6. http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=BCOM&date=20090904&id=103653177. http://newstribune.com/articles/2009/09/04/business/118biz51blockpr09.txt8. http://finance.aol.com/earnings/block-h-and-r-inc/hrb/nys/earnings-release9. http://industry.bnet.com/financial-services/10003127/ceo-smyth-promises-peace-of-mind-at-hr-block-with-customer-

centric-focus/10. http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=AP&date=20090908&id=1037167211. http://www.herald-dispatch.com/news/x883085341/Tax-credit-available-for-college-costs12. http://www.mlive.com/news/saginaw/index.ssf/2009/09/hr_block_hiring_15000_tax_prep.html13. http://www.huliq.com/1/87094/manager-keep-comcast-h-r-block-and-hasbro-radar14. http://www.seattlepi.com/business/1310ap_us_hr_block_meeting.html15. http://www.google.com/finance?q=OTC:GTAX16. http://www.google.com/finance?q=NASDAQ:INTU17. http://www.google.com/finance?q=NYSE:JTX18. http://www.reuters.com/finance/stocks/companyProfile?symbol=JTX.N&rpc=6619. http://www.iii.co.uk/news/?type=afxnews&articleid=7496335&action=article20. http://caps.fool.com/Blogs/ViewPost.aspx?bpid=223597&t=01003070853754792343