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June 11, 2018

WFIIYear End Targets Current 2018 Targets

2,779 2,800-2,9002018 S&P 500 Earnings Est $152.002018 S&P 500 Earnings Est (Street) $160.72

2.94% 2.75-3.25%3.08% 3.25-3.75%

$1,298.10 $1,250-1,350Oil, per barrel (WTI) $65.74 $50-60Oil, per barrel (Brent) $76.46 $55-65$ / Euro Exchange Rate $1.18 $1.18-1.26GDP (U.S.) 2.90%Inflation (U.S.) 2.40%

Sector Rec Weight Weight YTD ReturnFavorable 14.9% 13.0% 11.9%

Most Unfavorable 5.5% 6.7% -10.4%Unfavorable 4.0% 6.2% 7.4%

Favorable 16.4% 14.3% 1.1%Favorable 17.2% 14.0% 3.5%Favorable 11.6% 9.9% 1.3%

Neutral 21.8% 26.1% 14.2%Neutral 3.0% 2.7% 1.1%

Real Estate Neutral 3.1% 2.7% -1.9%Unfavorable 2.5% 1.8% -7.1%

Most Unfavorable 0.0% 2.7% -6.8%

Prices & data current as of:

Health Care

TelecomUtilities

WFII Strategy S&P 500 Index

Cons. DiscretionaryConsumer StaplesEnergy

S&P 500

10 Year Treasury Yield

Gold (per ounce)

Financials

30 Year Treasury Yield

June 8, 2018

IndustrialsInformation TechnologyMaterials

Investment and Insurance Products: NOT FDIC Insured NO Bank Guarantee MAY Lose Value

Sources: Throughout this report market and statistical data are sourced from FactSet, targets and sector weights are from Wells Fargo Investment Institute (WFII) and all other commentary and data are from Wells Fargo Advisors.

The Advisory Services Group (ASG) of Wells Fargo Advisors (WFA) works with information received from various resources including, but not limited to, research from affiliated and unaffiliated research correspondents as well as other sources. Utilizing this information, WFA publishes several theme-based lists of recommended equity securities. Each list strategy is based on a specific investment objective/risk tolerance and time horizon which may be different from the other lists. The equities listed in this report are an aggregation of the companies from the WFA thematic recommended list strategies: Core, DSIP, Dynamic Growth, Focus, High Yield Equity Income, International, SMID, and Value. The companies are listed by sector and include sector commentary from WFA's team of Equity Sector Analysts. The suitability of the individual securities should be reviewed by investors and their WFA financial advisor to determine whether a particular security is suitable for their portfolio, with full consideration given to existing portfolio holdings.

Please see pages 16 -18 of this report for Important Disclosures, Disclaimers and Analyst Certification.

Equity Sector Snapshots

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S&P 500 Quarterly Sector Performance*

2Q-2014 3Q-2014 4Q-2014 1Q-2015 2Q-2015 3Q-2015 4Q-2015 1Q-2016 2Q-2016 3Q-2016 4Q-2016 1Q-2017 2Q-2017 3Q-2017 4Q-2017 1Q-2018 YTD-2018

Energy Health Care Utilities Health Care Health Care Utilities Materials Telecom Energy Info Tech Financials Health Care Info Tech Info Tech Cons. Disc. Info Tech Info Tech

12.1% 5.5% 13.2% 6.5% 2.8% 5.4% 9.7% 16.6% 11.6% 12.9% 21.1% 7.1% 17.9% 8.6% 9.9% 3.5% 14.2%

Utilities Info Tech Cons. Disc. Cons. Disc. Cons. Disc. C. Staples Health Care Utilities Telecom Financials Energy Industrials Health Care Energy Info Tech Cons. Disc. Cons. Disc.

7.8% 4.8% 8.7% 4.8% 1.9% -0.2% 9.2% 15.6% 7.1% 4.6% 7.3% 4.7% 16.1% 6.8% 9.0% 3.1% 11.9%

Info Tech Telecom C. Staples Telecom Financials Cons. Disc. Info Tech C. Staples Utilities Industrials Industrials Financials Cons. Disc. Telecom Financials S&P 500 Energy

6.5% 3.1% 8.2% 1.5% 1.7% -2.6% 9.2% 5.6% 6.8% 4.1% 7.2% 4.2% 10.4% 6.8% 8.6% -0.8% 7.4%

Materials Financials Health Care Materials Telecom Info Tech Industrials Industrials Health Care S&P 500 Telecom Info Tech Industrials Materials Materials Financials S&P 500

5.6% 2.3% 7.5% 1.0% 1.6% -3.7% 8.0% 5.0% 6.3% 3.9% 4.8% 4.1% 10.2% 6.0% 6.9% -1.0% 4.8%

S&P 500 C. Staples Financials C. Staples S&P 500 S&P 500 Telecom Energy C. Staples Materials Materials Materials Materials Financials S&P 500 Health Care Health Care

5.2% 2.0% 7.2% 1.0% 0.3% -6.4% 7.6% 4.0% 4.6% 3.7% 4.7% 3.2% 9.9% 5.2% 6.6% -1.2% 3.5%

C. Staples S&P 500 Industrials S&P 500 Info Tech Financials C. Staples Materials Materials Cons. Disc. S&P 500 S&P 500 S&P 500 S&P 500 C. Staples Industrials Industrials

4.7% 1.1% 6.8% 1.0% 0.2% -6.7% 7.6% 3.6% 3.7% 2.9% 3.8% 3.1% 9.5% 4.5% 6.5% -1.6% 1.3%

Health Care Cons. Disc. Info Tech Info Tech Materials Telecom S&P 500 Info Tech S&P 500 Energy Cons. Disc. Real Estate Financials Industrials Industrials Utilities Financials

4.5% 0.3% 5.2% 0.6% -0.5% -6.8% 7.0% 2.6% 2.5% 2.3% 2.3% 2.8% 8.5% 4.2% 6.1% -3.3% 1.1%

Industrials Materials S&P 500 Industrials C. Staples Industrials Financials Cons. Disc. Financials Health Care Info Tech Cons. Disc. Utilities Health Care Energy Real Estate Materials

3.9% 0.2% 4.9% -0.9% -1.7% -6.9% 6.0% 1.6% 2.1% 0.9% 1.2% 2.4% 7.8% 3.7% 6.0% -5.0% 1.1%

Telecom Industrials Materials Financials Energy Health Care Cons. Disc. S&P 500 Industrials C. Staples Utilities Utilities C. Staples Utilities Telecom Materials Real Estate

3.8% -1.1% -1.8% -2.1% -1.9% -10.7% 5.8% 1.3% 1.4% -2.6% 0.1% 2.2% 7.2% 2.9% 3.6% -5.5% -1.9%

Cons. Disc. Utilities Telecom Energy Industrials Materials Utilities Financials Cons. Disc. Telecom C. Staples C. Staples Real Estate Real Estate Real Estate Energy Utilities

3.5% -4.0% -4.2% -2.9% -2.2% -16.9% 1.1% -5.1% -0.9% -5.6% -2.0% 1.6% 4.8% 0.9% 3.2% -5.9% -6.8%

Financials Energy Energy Utilities Utilities Energy Energy Health Care Info Tech Utilities Health Care Energy Telecom Cons. Disc. Health Care C. Staples Telecom

2.3% -8.6% -10.7% -5.2% -5.8% -17.4% 0.2% -5.5% -2.8% -5.9% -4.0% -6.4% -11.6% 0.8% 1.5% -7.1% -7.1%

Real Estate Telecom Energy C. Staples Utilities Telecom C. Staples

-4.4% -7.0% -13.7% -1.3% 0.2% -7.5% -10.4%

Sources: FactSet, Wells Fargo Advisors.*Total return includes cash dividends. Past performance is no guarantee of future results. You can not invest directly in an index or industry.Sector performance is based on the Global Industry Classification Standards (GICS) in which each company in the S&P 500 is assigned to one of 11 sectors according to the definition of its principal activity.

S&P 500 Annual Sector Performance*

2008 2009 2010 2011 2012 2013 2014 2015 2016 201710Y: '08-

'17

C. Staples Info Tech Cons. Disc. Utilities Financials Cons. Disc. Utilities Cons. Disc. Energy Info Tech Cons. Disc.

-15.4% 61.7% 27.7% 20.0% 28.8% 43.1% 29.0% 10.1% 27.4% 38.8% 255.5%

Health Care Materials Industrials C. Staples Cons. Disc. Health Care Health Care Health Care Telecom Materials Info Tech

-22.8% 48.6% 26.7% 14.0% 23.9% 41.5% 25.3% 6.9% 23.5% 23.8% 207.7%

Utilities Cons. Disc. Materials Health Care Telecom Industrials Info Tech C. Staples Financials Cons. Disc. Health Care

-29.00% 41.3% 22.2% 12.7% 18.3% 40.7% 20.1% 6.6% 22.8% 23.0% 184.5%

Telecom S&P 500 Energy Telecom Health Care Financials C. Staples Info Tech Industrials Financials C. Staples

-30.5% 26.5% 20.5% 6.3% 17.9% 35.6% 16.0% 5.9% 18.9% 22.2% 161.0%

Cons. Disc. Industrials Telecom Cons. Disc. S&P 500 S&P 500 Financials Telecom Materials Health Care Industrials

-33.5% 20.9% 19.0% 6.1% 16.0% 32.4% 15.2% 3.4% 16.7% 22.1% 128.7%

Energy Health Care S&P 500 Energy Industrials Info Tech S&P 500 S&P 500 Utilities S&P 500 S&P 500

-34.9% 19.7% 15.1% 4.7% 15.3% 28.4% 13.7% 1.4% 16.3% 21.8% 126.0%

S&P 500 Financials C. Staples Info Tech Materials C. Staples Industrials Financials Info Tech Industrials Utilities

-37.0% 17.2% 14.1% 2.4% 15.0% 26.1% 9.8% -1.5% 13.8% 21.0% 84.5%

Industrials C. Staples Financials S&P 500 Info Tech Materials Cons. Disc. Industrials S&P 500 C. Staples Materials

-39.9% 14.9% 12.1% 2.1% 14.8% 25.6% 9.7% -2.5% 12.0% 13.5% 82.0%

Info Tech Energy Info Tech Industrials C. Staples Energy Materials Utilities Cons. Disc. Utilities Telecom

-43.1% 13.8% 10.2% -0.6% 10.8% 25.1% 6.9% -4.8% 6.0% 12.1% 63.9%

Materials Utilities Utilities Materials Energy Utilities Telecom Materials C. Staples Real Estate Financials

-45.7% 11.9% 5.5% -9.8% 4.6% 13.2% 3.0% -8.4% 5.4% 10.8% 44.9%

Financials Telecom Health Care Financials Utilities Telecom Energy Energy Health Care Energy Energy

-55.3% 8.9% 2.9% -17.1% 1.3% 11.5% -7.8% -21.1% -2.7% -1.0% 12.2%

Real Estate Telecom

**-5.7% -1.3%

Sources: FactSet, Wells Fargo Advisors.*Total return includes cash dividends. **Real Estate was classified as a standalone GICS sector on 8/31/2016.Past performance is no guarantee of future results. You can not invest directly in an index or industry.Sector performance is based on the Global Industry Classification Standards (GICS) in which each company in the S&P 500 isassigned to one of 11 sectors according to the definition of its principal activity.

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Consumer Discretionary

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AMZN Amazon.com, Inc. 1,683.99$ -$ 0.0% 15.51$ 108.6 817,117$ AZO AutoZone, Inc. 674.39$ -$ 0.0% 54.92$ 12.3 17,981$ BURL Burlington Stores, Inc. 156.41$ -$ 0.0% 6.35$ 24.6 10,575$ KMX CarMax, Inc. 73.79$ -$ 0.0% 4.54$ 16.3 13,140$ CRI Carter's, Inc. 112.60$ 1.80$ 1.6% 6.71$ 16.8 5,286$ CVNA Carvana Co. 36.04$ -$ 0.0% (0.97)$ (37.1) 1,147$ CMCSA Comcast Corp. 32.08$ 0.76$ 2.4% 2.60$ 12.3 147,621$ PLAY Dave & Buster's Entertainment, Inc. 47.62$ -$ 0.0% 2.74$ 17.4 1,888$ DKS Dick's Sporting Goods, Inc. 37.42$ 0.90$ 2.4% 3.11$ 12.0 3,836$ DISCA Discovery, Inc. 23.02$ -$ 0.0% 2.71$ 8.5 11,147$ F Ford Motor Co. 12.10$ 0.60$ 5.0% 1.54$ 7.8 48,220$ GRMN Garmin Ltd. 61.85$ 2.12$ 3.4% 3.20$ 19.3 11,660$ GM General Motors Co. 44.25$ 1.52$ 3.4% 6.48$ 6.8 62,368$ HD The Home Depot, Inc. 198.33$ 4.12$ 2.1% 9.71$ 20.4 228,782$ IHG InterContinental Hotels Group Plc 66.47$ 1.67$ 2.5% 3.00$ 22.1 12,674$ LVS Las Vegas Sands Corp. 78.00$ 3.00$ 3.8% 3.65$ 21.4 61,557$ LILA Liberty Latin America Ltd. 21.95$ -$ 0.0% 0.09$ 258.0 3,757$ LOW Lowe's Cos., Inc. 100.22$ 1.92$ 1.9% 5.68$ 17.7 81,795$ M Macy's, Inc. 39.88$ 1.51$ 3.8% 3.70$ 10.8 12,218$ MCD McDonald's Corp. 168.91$ 4.04$ 2.4% 7.93$ 21.3 132,624$ NKE NIKE, Inc. 74.90$ 0.80$ 1.1% 2.69$ 27.9 120,716$ OMC Omnicom Group, Inc. 73.90$ 2.40$ 3.2% 5.78$ 12.8 16,797$ ORLY O'Reilly Automotive, Inc. 283.13$ -$ 0.0% 16.29$ 17.4 23,192$ PLNT Planet Fitness, Inc. 43.12$ -$ 0.0% 1.30$ 33.2 3,780$ PII Polaris Industries Inc. 126.01$ 2.40$ 1.9% 6.52$ 19.3 7,957$ POOL Pool Corp. 149.11$ 1.80$ 1.2% 5.79$ 25.8 6,035$ PVH PVH Corp. 168.16$ 0.15$ 0.1% 9.59$ 17.5 12,958$ ROST Ross Stores, Inc. 85.84$ 0.90$ 1.0% 4.22$ 20.4 32,502$ SNE Sony Corp. 49.96$ 0.20$ 0.4% 3.75$ 13.3 63,306$ SBUX Starbucks Corp. 56.60$ 1.20$ 2.1% 2.68$ 21.1 78,108$ TJX The TJX Cos., Inc. 94.94$ 1.56$ 1.6% 5.02$ 18.9 59,534$ TM Toyota Motor Corp. 136.21$ 3.54$ 2.6% 13.92$ 9.8 198,181$ VFC VF Corp. 83.67$ 1.84$ 2.2% 3.62$ 23.1 33,004$ DIS The Walt Disney Co. 103.98$ 1.68$ 1.6% 7.56$ 13.8 154,592$ W Wayfair, Inc. 105.41$ -$ 0.0% (2.67)$ (39.5) 9,388$ Back to first page

The proliferation of online shopping has been a disruptive force to brick and mortar retailers and has decreased mall traffic resulting in accelerated store closures as traditional retailers attempt to navigate the shift to online. Same-store sales trends suggest that further closings and footprint reductions remain likely for retailers with significant exposure to traditional shopping malls, and millennial purchasing habits are expected to continue to pressure retail margins. Mobile devices have become the new laptops, increasingly allowing consumers to comparison shop from virtually any location and purchase goods based purely on the lowest price. Additional incentives such as free shipping and rewards programs help retail companies create strong customer brand loyalty. We believe brands with strong loyalty and vertically integrated companies that have control over the distribution and pricing of goods are best equipped to maintain strong margins and offer the best sales and earnings growth potential into 2018 and beyond. We view Internet Retail as a preferred sub-industry and would recommend avoidance of sub-standard Department Store competitors. Other sub-industries that we view as relatively immune to e-commerce penetration are Home Improvement, Automotive Aftermarket Retail, and Off-Price Retail. – Brian Postol, Equity Sector Analyst

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Consumer StaplesMarch 26, 2018

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MO Altria Group, Inc. 57.71$ 2.80$ 4.9% 4.15$ 13.9 109,225$ BUD Anheuser-Busch InBev SA/NV 94.67$ 3.34$ 3.5% 5.16$ 18.3 152,201$ BTI British American Tobacco plc 49.31$ 2.68$ 5.4% 4.25$ 11.6 56,551$ BF.B Brown-Forman Corp. 52.97$ 0.63$ 1.2% 1.83$ 28.9 25,473$ CLX The Clorox Co. 126.75$ 3.84$ 3.0% 6.36$ 19.9 16,415$ KO The Coca-Cola Co. 43.95$ 1.56$ 3.5% 2.17$ 20.2 187,019$ CL Colgate-Palmolive Co. 63.34$ 1.68$ 2.7% 3.26$ 19.4 55,253$ COST Costco Wholesale Corp. 203.76$ 2.28$ 1.1% 7.54$ 27.0 89,357$ DEO Diageo Plc 146.37$ 3.40$ 2.3% 6.83$ 21.4 90,048$ EL Estee Lauder Cos., Inc. 153.05$ 1.52$ 1.0% 5.00$ 30.6 56,175$ HRL Hormel Foods Corp. 36.21$ 0.75$ 2.1% 1.89$ 19.2 19,210$ SJM The J. M. Smucker Co. 102.52$ 3.12$ 3.0% 8.61$ 11.9 11,646$ KMB Kimberly-Clark Corp. 103.27$ 4.00$ 3.9% 7.06$ 14.6 36,075$ KR The Kroger Co. 25.36$ 0.50$ 2.0% 2.13$ 11.9 20,614$ MKC McCormick & Co., Inc. 103.48$ 2.08$ 2.0% 5.16$ 20.1 13,582$ MDLZ Mondelez International, Inc. 39.78$ 0.88$ 2.2% 2.55$ 15.6 58,678$ PEP PepsiCo, Inc. 102.49$ 3.71$ 3.6% 5.87$ 17.5 145,315$ PM Philip Morris International, Inc. 79.42$ 4.56$ 5.7% 5.44$ 14.6 123,456$ POST Post Holdings, Inc. 82.00$ -$ 0.0% 5.12$ 16.0 5,518$ PG Procter & Gamble Co. 77.18$ 2.87$ 3.7% 4.44$ 17.4 194,077$ SYY Sysco Corp. 66.15$ 1.44$ 2.2% 3.46$ 19.1 34,463$ UL Unilever Plc 55.46$ 1.74$ 3.1% 2.89$ 19.2 67,589$ WBA Walgreens Boots Alliance, Inc. 63.40$ 1.60$ 2.5% 6.36$ 10.0 62,872$ WMT Walmart, Inc. 84.36$ 2.08$ 2.5% 4.88$ 17.3 248,933$

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The Consumer Staples sector underperformed the S&P 500 in the first-half of 2018. This should come as no surprise given the sector’s weakened fundamentals and as the markets have favored growth stocks over the defensive and rising income stories Consumer Staples companies provide. It hasn’t helped either that interest rates are on the rise, making the group’s dividend yields less desirable. The weakness in the sector is broad based, affecting most subsectors (tobacco, household products, food and beverage) and companies equally. Fundamentals are weak right now on all fronts. Sales growth is hard to come by as these companies are encountering more resistance raising prices to retailers. In addition, cost pressures are numerous in the areas of raw materials and higher freight and logistics costs. Passing through these costs to the end user is becoming more challenging so it is imperative these companies continue to cut costs to offset these higher costs. After tough going in the group here recently and with valuations no longer at the higher end of historic ranges, we believe the group could trade in choppy fashion for the remainder of 2018. There are several important factors that could drive performance going forward in the Consumer Staples sector. We believe the sector needs to get back to delivering consistency in growing sales and earnings. Investors have relied upon these defensive attributes historically and through varying economic cycles. Staples companies need to address this by innovating with new products, selling products that promote health and wellness and finally by carefully watching expenses. At some point the overall market could be looking more favorably towards defensive sectors like Consumer Staples especially if economic growth slows. Consumers are usually staples buyers regardless of the state of the economy making the group minimally cyclical and quite defensive. But for now, a positive domestic economy, rising wages and improving employment all should aid positive consumer spending patterns for the majority of these companies. Finally, these companies are producers of healthy amounts of free cash flow after funding operations. This is due to the relatively minimal reinvestment needed in their core businesses. This excess capital can be returned to shareholders in the form of higher dividends and stock buybacks, the latter of which might make sense right now given weakened valuations. The potential headwinds facing the group are higher commodity costs, pricing compression from retailers and private label competition, and sensitivity to higher interest rates and the impact of such on the U.S. dollar. – Jack Russo, CFA, Equity Sector Analyst

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EnergyMarch 26, 2018

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APA Apache Corp. 42.24$ 1.00$ 2.4% 1.79$ 23.6 16,142$ BP BP Plc 47.04$ 2.38$ 5.1% 3.20$ 14.7 156,405$ LNG Cheniere Energy, Inc. 65.39$ -$ 0.0% 2.04$ 32.1 16,224$ CVX Chevron Corp. 126.44$ 4.48$ 3.5% 7.98$ 15.9 241,622$ XEC Cimarex Energy Co. 85.59$ 0.64$ 0.7% 7.82$ 10.9 8,168$ CXO Concho Resources, Inc. 128.28$ -$ 0.0% 5.15$ 24.9 19,123$ ENB Enbridge, Inc. 31.33$ 2.07$ 6.6% 1.98$ 15.8 53,410$ EPD Enterprise Products Partners LP 29.22$ 1.71$ 5.9% 1.64$ 17.9 63,485$ EOG EOG Resources, Inc. 117.67$ 0.74$ 0.6% 5.56$ 21.2 68,115$ XOM Exxon Mobil Corp. 83.60$ 3.28$ 3.9% 5.07$ 16.5 353,948$ HAL Halliburton Co. 48.10$ 0.72$ 1.5% 2.87$ 16.7 42,134$ KMI Kinder Morgan, Inc. 16.85$ 0.80$ 4.7% 0.92$ 18.3 37,172$ MTDR Matador Resources Co. 25.97$ -$ 0.0% 1.59$ 16.3 3,019$ PSX Phillips 66 116.84$ 3.20$ 2.7% 8.12$ 14.4 54,485$ RDS.B Royal Dutch Shell Plc 73.16$ 3.76$ 5.1% 5.69$ 12.9 137,010$ VLO Valero Energy Corp. 119.72$ 3.20$ 2.7% 8.28$ 14.5 51,590$ Back to first page

The Energy sector is the third best performing sector in the S&P 500 year-to-date in 2018 (as-of June 11, 2018). Gains have been spread across the sector, with refining and marketing firms faring best. Our favored sub-industry of integrated oil companies (IOCs) has performed relatively poorly year-to-date. The Wells Fargo Investment Institute recently raised its year-end 2018 oil price target range to $50 - $60 for West Texas Intermediate crude oil, though the top end of the range remains below the current trading price (as-of June 7, 2018). We continue to believe that the prices of energy equities will be led by energy commodity prices. With the outlook for both crude oil and natural gas prices being lower for the foreseeable future, including the Wells Fargo Investment Institute’s crude oil price target which is below current trading levels, we expect another difficult year for energy equities in 2018. We favor IOCs, given the stable cash flows, reasonable yields and balance sheet strength. These names are destined to underperform the broader energy sector in periods of rapidly rising commodity prices. For more direct commodity price exposure, we maintain our positive outlook on well capitalized, upstream exploration and production names operating in low cost U.S. shale basins. Producers in the U.S. in particular have benefited from dramatic declines in the cost of production, which has increased the net asset value (NAV) estimates of resource bases, and is increasingly driving stepped up drilling activity. In the master limited partnership (MLP) space, our experience in 2017 was worse than expected and 2018 performance has been weak, as regulatory changes compounded on already soft financial performance to limit returns. In many cases MLP equities are trading at levels that pressure the historic business model of issuing equity to fund growth, prompting many to engage in distribution cuts, and restructurings. We are thus more selective than before in recommending MLPs, again biasing up in quality. – Daniel Moisio, CFA, Equity Sector Analyst

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FinancialsMarch 26, 2018

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AMG Affiliated Managers Group, Inc. 165.05$ 1.20$ 0.7% 17.25$ 9.6 8,965$ AFL Aflac, Inc. 45.89$ 1.04$ 2.3% 4.04$ 11.4 35,527$ ALL The Allstate Corp. 93.71$ 1.84$ 2.0% 8.90$ 10.5 32,938$ APAM Artisan Partners Asset Management, Inc. 33.10$ 2.40$ 7.3% 3.16$ 10.5 1,785$ SAN Banco Santander SA 5.55$ 0.21$ 3.7% 0.62$ 8.9 89,534$ BAC Bank of America Corp. 30.01$ 0.48$ 1.6% 2.70$ 11.1 304,283$ OZRK Bank of The Ozarks 49.82$ 0.78$ 1.6% 3.92$ 12.7 6,436$ BKU BankUnited, Inc. 43.96$ 0.84$ 1.9% 3.23$ 13.6 4,663$ BBT BB&T Corp. 54.60$ 1.50$ 2.7% 4.16$ 13.1 42,574$ BLK BlackRock, Inc. 549.41$ 11.52$ 2.1% 29.44$ 18.7 87,999$ BRO Brown & Brown, Inc. 28.48$ 0.30$ 1.1% 1.27$ 22.5 7,867$ COF Capital One Financial Corp. 96.97$ 1.60$ 1.6% 10.36$ 9.4 47,170$ CBOE Cboe Global Markets, Inc. 103.95$ 1.08$ 1.0% 4.75$ 21.9 11,693$ SCHW The Charles Schwab Corp. 57.73$ 0.40$ 0.7% 2.63$ 21.9 77,888$ CB Chubb Ltd. 133.52$ 2.92$ 2.2% 10.84$ 12.3 62,194$ C Citigroup, Inc. 68.47$ 1.28$ 1.9% 6.89$ 9.9 174,594$ CBSH Commerce Bancshares, Inc. (Missouri) 66.96$ 0.94$ 1.4% 3.70$ 18.1 7,138$ DFS Discover Financial Services 75.38$ 1.40$ 1.9% 8.09$ 9.3 26,306$ EV Eaton Vance Corp. 56.45$ 1.24$ 2.2% 3.50$ 16.1 6,754$ EVR Evercore, Inc. 110.90$ 2.00$ 1.8% 7.59$ 14.6 4,516$ FNB F.N.B. Corp. (Pennsylvania) 14.11$ 0.48$ 3.4% 1.17$ 12.1 4,570$ FDS FactSet Research Systems, Inc. 208.41$ 2.56$ 1.2% 9.27$ 22.5 8,102$ FRC First Republic Bank (San Francisco) 103.38$ 0.72$ 0.7% 5.12$ 20.2 16,724$ GS The Goldman Sachs Group, Inc. 233.39$ 3.20$ 1.4% 23.53$ 9.9 88,156$ GBDC Golub Capital BDC, Inc. 18.36$ 1.28$ 7.0% 1.30$ 14.2 1,099$ HSBC HSBC Holdings Plc 49.38$ 2.55$ 5.2% 3.71$ 13.3 197,881$ HBAN Huntington Bancshares, Inc. 15.69$ 0.44$ 2.8% 1.27$ 12.3 17,337$ ICE Intercontinental Exchange, Inc. 75.66$ 0.96$ 1.3% 3.70$ 20.5 43,824$ JPM JPMorgan Chase & Co. 111.11$ 2.24$ 2.0% 9.39$ 11.8 378,305$ LYG Lloyds Banking Group Plc 3.39$ 0.16$ 4.8% 0.40$ 8.5 61,074$ MTB M&T Bank Corp. 177.11$ 3.20$ 1.8% 12.66$ 14.0 25,727$ PACW PacWest Bancorp 55.62$ 2.40$ 4.3% 3.80$ 14.6 6,960$ RJF Raymond James Financial, Inc. 100.60$ 1.20$ 1.2% 7.41$ 13.6 14,674$ SIVB SVB Financial Group 325.72$ -$ 0.0% 17.29$ 18.8 17,255$ TRI Thomson Reuters Corp. 40.82$ 1.38$ 3.4% 1.02$ 40.2 28,823$ TROW T. Rowe Price Group, Inc. 125.98$ 2.80$ 2.2% 7.40$ 17.0 30,504$ TPRE Third Point Reinsurance Ltd. 13.95$ -$ 0.0% 1.84$ 7.6 1,426$ TSLX TPG Specialty Lending, Inc. 18.61$ 1.56$ 8.4% 1.91$ 9.8 1,208$ USB U.S. Bancorp 52.05$ 1.20$ 2.3% 4.19$ 12.4 85,490$ UBS UBS Group AG 15.45$ 0.65$ 4.2% 1.49$ 10.4 58,114$ WBS Webster Financial Corp. 67.70$ 1.32$ 1.9% 3.70$ 18.3 6,235$ WBK Westpac Banking Corp. 21.21$ 1.42$ 6.7% 1.86$ 11.4 72,426$ Back to first page

Interest rates are critical to Financial sector performance and are a key driver of return-on-equity, particularly for banks and life insurers. Interest rates are inherently tied to the economic cycle. We would expect stronger economic growth and lower unemployment to translate into higher interest rates to the benefit of the Financial sector. Stronger economic activity would also likely increase loan demand, to the benefit of banks. Recently stronger economic activity in the United States and globally has modestly increased our outlook for key drivers of financial sector performance including loan growth, asset prices, and interest rate increases. Competition in the banking sector continues to be fierce, and recent trends indicate that many institutions are being forced to trade between loan growth and net interest margins. Looking out through 2018, we are modestly shifting our view to focus less on the direction of interest rates, and more on which businesses we believe will be well positioned to grow earnings regardless of the interest rate and market environment. That being said, we are emphasizing insurance companies, particularly property/casualty insurers, as well as large, diversified banks as the best areas to invest in 2018. -- Daniel Moisio, CFA, Equity Sector Analyst

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Health CareMarch 26, 2018

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ABT Abbott Laboratories 63.27$ 1.12$ 1.8% 3.02$ 21.0 110,924$ ABMD ABIOMED, Inc. 409.77$ -$ 0.0% 3.72$ 110.0 18,226$ AET Aetna, Inc. 180.81$ 2.00$ 1.1% 11.38$ 15.9 59,143$ AGN Allergan Plc 170.35$ 2.88$ 1.7% 16.33$ 10.4 57,760$ MDRX Allscripts Healthcare Solutions, Inc. 12.62$ -$ 0.0% 0.82$ 15.5 2,246$ ABC AmerisourceBergen Corp. 86.09$ 1.52$ 1.8% 7.00$ 12.3 18,923$ AMGN Amgen, Inc. 184.30$ 5.28$ 2.9% 13.88$ 13.3 121,952$ BDX Becton, Dickinson & Co. 231.84$ 3.00$ 1.3% 12.13$ 19.1 61,948$ BIIB Biogen, Inc. 303.29$ -$ 0.0% 24.85$ 12.2 63,997$ BMY Bristol-Myers Squibb Co. 53.16$ 1.60$ 3.0% 3.53$ 15.1 86,892$ CELG Celgene Corp. 79.06$ -$ 0.0% 9.28$ 8.5 57,305$ CVS CVS Health Corp. 66.03$ 2.00$ 3.0% 7.11$ 9.3 67,129$ DHR Danaher Corp. 103.00$ 0.64$ 0.6% 4.63$ 22.3 71,953$ FMS Fresenius Medical Care AG & Co. KGaA 51.23$ 0.43$ 0.8% 2.76$ 18.5 31,400$ GILD Gilead Sciences, Inc. 71.91$ 2.28$ 3.2% 6.29$ 11.4 93,502$ GSK GlaxoSmithKline Plc 41.02$ 2.18$ 5.3% 2.98$ 13.7 101,720$ JNJ Johnson & Johnson 124.06$ 3.60$ 2.9% 8.32$ 14.9 332,748$ MDT Medtronic Plc 87.18$ 1.84$ 2.1% 5.17$ 16.9 118,061$ MRK Merck & Co., Inc. 62.58$ 1.92$ 3.1% 4.37$ 14.3 168,359$ NVS Novartis AG 75.21$ 2.49$ 3.3% 5.35$ 14.1 174,296$ NVO Novo Nordisk A/S 44.93$ 0.91$ 2.0% 2.59$ 17.3 84,973$ PFE Pfizer Inc. 36.67$ 1.36$ 3.7% 3.00$ 12.2 214,504$ PHG Royal Philips NV 42.53$ 0.80$ 1.9% 2.17$ 19.6 39,391$ SHPG Shire Plc 160.96$ 1.05$ 0.6% 15.64$ 10.3 49,036$ SYK Stryker Corp. 178.95$ 1.88$ 1.1% 7.53$ 23.8 66,876$ SYNH Syneos Health, Inc. 42.80$ -$ 0.0% 2.85$ 15.0 4,399$ UNH UnitedHealth Group, Inc. 250.68$ 3.15$ 1.3% 13.35$ 18.8 240,899$ WMGI Wright Medical Group NV 24.57$ -$ 0.0% (0.03)$ (820.9) 2,604$

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Efforts to reform the health care system will continue to be an underlying theme driving the sector for the foreseeable future. We anticipate that repeal and replace of the Affordable Care Act (ACA) will remain a focus in 2018. The general direction that the current administration seems to be heading towards in this respect may result in a neutral to positive impact on the sector on a net basis. Tax reform could potentially aid companies in their efforts as they continue to focus on growing their franchises, filling pipelines and returning value to shareholders. But we believe a benefit could be somewhat concentrated to a few companies, and repatriation could be a mixed bag for companies with international operations—yet, the appetite for acquisitions is still strong and a select few companies may still benefit. We anticipate companies will continue to use spin-offs and mergers & acquisitions (M&A) as a form of refocusing businesses internally and as a way to unlock value in non-core businesses. Many companies are in need of filling pipelines with new product opportunities, and we believe the appetite for M&A within the bio-pharma sub-industries will continue into 2018. Tax reform may provide some additional benefits. Pharmaceutical pricing seems to be a concern to the current administration “on and off.” We do not believe pricing issues are all gone, but we believe that in general, the new administration seems to be heading in a friendlier direction for the pharmaceutical sub-industry. We favor the pharmaceutical sub-industry notwithstanding rhetoric of pharmaceutical pricing may continue to emerge on occasion. Additionally, we remain positive on the medical equipment sub-industry and anticipate any health care reform may be positive to industry. Finally, although on the higher valuation side of the sector’s spectrum, we continue to favor large diversified managed care companies that can manage the exposure to changes within the health care legislative reform efforts. – Greg Simpson, CFA, Equity Sector Analyst

9

IndustrialsMarch 26, 2018

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MMM 3M Co. 206.59$ 5.44$ 2.6% 10.80$ 19.1 122,651$ ABB ABB Ltd. 23.13$ 0.78$ 3.4% 1.46$ 15.8 49,238$ AGCO AGCO Corp. 63.68$ 0.60$ 0.9% 4.22$ 15.1 5,065$ ALSN Allison Transmission Holdings, Inc. 42.04$ 0.60$ 1.4% 4.00$ 10.5 5,777$ CP Canadian Pacific Railway Ltd. 192.38$ 2.02$ 1.1% 10.64$ 18.1 27,525$ CLH Clean Harbors, Inc. 54.35$ -$ 0.0% 1.04$ 52.4 3,054$ CMI Cummins, Inc. 143.68$ 4.32$ 3.0% 13.71$ 10.5 23,675$ DCI Donaldson Co., Inc. 48.18$ 0.76$ 1.6% 2.22$ 21.7 6,257$ DY Dycom Industries, Inc. 95.46$ -$ 0.0% 5.27$ 18.1 2,978$ ETN Eaton Corp. Plc 80.35$ 2.64$ 3.3% 5.46$ 14.7 35,137$ EMR Emerson Electric Co. 73.15$ 1.94$ 2.7% 3.47$ 21.1 46,091$ FDX FedEx Corp. 260.15$ 2.00$ 0.8% 17.48$ 14.9 69,516$ FLS Flowserve Corp. 42.17$ 0.76$ 1.8% 1.81$ 23.3 5,517$ GD General Dynamics Corp. 202.58$ 3.72$ 1.8% 11.81$ 17.2 60,173$ HRS Harris Corp. 154.65$ 2.28$ 1.5% 7.74$ 20.0 18,361$ HON Honeywell International, Inc. 151.86$ 2.98$ 2.0% 8.36$ 18.2 113,429$ ITW Illinois Tool Works, Inc. 147.76$ 3.12$ 2.1% 8.04$ 18.4 50,056$ IR Ingersoll-Rand Plc 90.69$ 1.80$ 2.0% 5.60$ 16.2 22,488$ JBHT J.B. Hunt Transport Services, Inc. 128.68$ 0.96$ 0.7% 5.75$ 22.4 14,123$ KSU Kansas City Southern 109.25$ 1.44$ 1.3% 6.54$ 16.7 11,209$ LSTR Landstar System, Inc. 114.20$ 0.60$ 0.5% 5.95$ 19.2 4,804$ LMT Lockheed Martin Corp. 322.31$ 8.00$ 2.5% 17.11$ 18.8 92,029$ PCAR PACCAR, Inc. 65.26$ 1.12$ 1.7% 5.73$ 11.4 22,959$ PH Parker-Hannifin Corp. 174.71$ 3.04$ 1.7% 11.47$ 15.2 23,229$ RELX RELX Plc 22.87$ 0.52$ 2.3% 1.17$ 19.5 23,984$ SNDR Schneider National, Inc. 29.21$ 0.24$ 0.8% 1.55$ 18.8 5,189$ UPS United Parcel Service, Inc. 116.60$ 3.64$ 3.1% 7.52$ 15.5 100,691$ URI United Rentals, Inc. 166.80$ -$ 0.0% 15.87$ 10.5 13,944$ UTX United Technologies Corp. 127.61$ 2.80$ 2.2% 7.43$ 17.2 102,096$ GWW W.W. Grainger, Inc. 314.59$ 5.44$ 1.7% 15.71$ 20.0 17,622$ WBC WABCO Holdings, Inc. 124.28$ -$ 0.0% 8.05$ 15.4 6,661$ XPO XPO Logistics, Inc. 111.28$ -$ 0.0% 3.83$ 29.1 13,425$

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We expect 2018 to be a more ‘normal’ year for the broader industrial sector, with demand having now bounced off of cyclical lows in most markets and re-stocking activity largely complete. We anticipate more modest revenue growth and lower incremental margins as the early cycle recovery in oil and gas, mining, and China themes generally have largely played out. That said, we still see a solid year as most end markets remain well below replacement rates, the U.S. dollar has receded from cycle highs and commodity prices have firmed. We believe the provision allowing immediate expensing of capital equipment purchases contained within U.S. tax reform legislation could provide an incremental positive driver of demand. We would generally expect slightly above market earnings growth from the industrial sector in 2018 driven by improving order activity and continued benefits from restructuring activity. We continue to view machinery as more favorable in this context, with order activity in many end markets not yet back to replacement levels and with most companies continuing to reap savings from cost saving actions and continuous improvement programs. Global capital expenditures still remain relatively subdued, especially in large process industries (i.e. oil and gas, mining) as well as infrastructure, leaving the potential for upside from additional end markets in the coming quarters and years. -- Larry Pfeffer, CFA, Equity Sector Analyst

10

Information TechnologyMarch 26, 2018

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ACN Accenture Plc 162.17$ 2.66$ 1.6% 7.16$ 22.6 104,289$ AKAM Akamai Technologies, Inc. 78.48$ -$ 0.0% 3.49$ 22.5 13,391$ ADS Alliance Data Systems Corp. 222.38$ 2.28$ 1.0% 23.89$ 9.3 12,320$ GOOGL Alphabet, Inc. 1,132.71$ -$ 0.0% 45.55$ 24.9 786,721$ ADI Analog Devices, Inc. 101.06$ 1.92$ 1.9% 5.88$ 17.2 37,483$ AAPL Apple, Inc. 191.70$ 2.92$ 1.5% 12.61$ 15.2 942,232$ AMAT Applied Materials, Inc. 51.15$ 0.80$ 1.6% 4.64$ 11.0 51,562$ ASML ASML Holding NV 207.45$ 1.44$ 0.7% 7.58$ 27.4 88,663$ ADP Automatic Data Processing, Inc. 135.35$ 2.76$ 2.0% 4.89$ 27.7 59,625$ AVGO Broadcom, Inc. 257.97$ 7.00$ 2.7% 20.39$ 12.7 105,962$ BR Broadridge Financial Solutions, Inc. 119.40$ 1.46$ 1.2% 4.56$ 26.2 14,080$ CHKP Check Point Software Technologies Ltd. 99.10$ -$ 0.0% 5.80$ 17.1 15,760$ CSCO Cisco Systems, Inc. 43.48$ 1.32$ 3.0% 2.85$ 15.2 204,481$ CY Cypress Semiconductor Corp. 17.07$ 0.44$ 2.6% 1.33$ 12.8 6,119$ DLB Dolby Laboratories, Inc. 64.31$ 0.64$ 1.0% 2.06$ 31.2 6,763$ EA Electronic Arts, Inc. 137.87$ -$ 0.0% 5.13$ 26.9 42,303$ EVBG Everbridge, Inc. 47.44$ -$ 0.0% (0.48)$ (98.9) 1,364$ FB Facebook, Inc. 189.10$ -$ 0.0% 8.26$ 22.9 547,581$ GWRE Guidewire Software, Inc. 88.60$ -$ 0.0% 1.23$ 71.8 7,111$ HPQ HP, Inc. 23.71$ 0.56$ 2.3% 2.08$ 11.4 38,185$ INTC Intel Corp. 55.05$ 1.20$ 2.2% 3.93$ 14.0 256,533$ IBM International Business Machines Corp. 146.14$ 6.28$ 4.3% 13.95$ 10.5 134,152$ JKHY Jack Henry & Associates, Inc. 129.65$ 1.48$ 1.1% 3.99$ 32.5 10,021$ JNPR Juniper Networks, Inc. 27.92$ 0.72$ 2.6% 1.95$ 14.3 9,748$ KLAC KLA-Tencor Corp. 114.20$ 3.00$ 2.6% 8.70$ 13.1 17,770$ MXIM Maxim Integrated Products, Inc. 60.75$ 1.68$ 2.8% 2.88$ 21.1 16,990$ MCHP Microchip Technology, Inc. 102.15$ 1.45$ 1.4% 6.49$ 15.7 24,009$ MSFT Microsoft Corp. 101.63$ 1.68$ 1.7% 4.03$ 25.2 780,844$

Information Technology (IT) has been one of the top performing groups within the S&P, handily outperforming the benchmark S&P 500 Index in 2017. We anticipate semiconductor spending to continue expanding into at least the first half of 2018, but the pace of growth may show signs of slowing. In our view, Semiconductor firms with exposure to specialized cutting-edge applications (i.e. artificial intelligence, deep learning and augmented/virtual reality) will likely be best positioned going forward. We continue to favor Semiconductor companies with exposure to the industrial and automotive end markets. Those companies with semiconductor applications in the automotive industry should benefit as the amount of digital content inside the vehicle is expected to increase dramatically over the next few years. Features like the advanced driver assist systems (ADAS), in-vehicle connectivity, and highly complex infotainment systems are becoming commonplace in new vehicles. In our view, rising content within industrial end-markets is quite comparable to the automotive segment, yet it may be underestimated. Applications within the industrial environment are spread across a greater number of use cases, including factory automation and smart business applications. Tailwinds within the semiconductor industry should also help elongate the semiconductor capital equipment purchasing cycle. As new leading edge technologies are developed (specifically 3D NAND memory and Extreme Ultraviolet (EUV) technologies), firms will likely need to purchase additional equipment. China is expected to enter the market and spend billions of dollars over the next few years on equipment for manufacturing facilities. These trends should provide a tailwind to extend the purchasing cycle. We believe the growing secular shift to the cloud will remain one of the most powerful themes in software today. The cloud business, in our opinion, represents a generational shift within the industry, as businesses of all shapes and sizes continue to transition their data/information to the cloud. We are likely in the early years of a multi-decade migration to the cloud. – Tom Christopher, Equity Sector Analyst

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NVDA NVIDIA Corp. 262.28$ 0.60$ 0.2% 7.39$ 35.5 159,204$ ORCL Oracle Corp. 48.18$ 0.76$ 1.6% 3.37$ 14.3 196,686$ PAYX Paychex, Inc. 68.17$ 2.24$ 3.3% 2.79$ 24.4 24,492$ PYPL PayPal Holdings, Inc. 84.34$ -$ 0.0% 2.55$ 33.1 100,144$ PFPT Proofpoint, Inc. 120.81$ -$ 0.0% 1.31$ 92.5 6,143$ RHT Red Hat, Inc. 171.06$ -$ 0.0% 3.59$ 47.6 30,393$ CRM salesforce.com, inc. 133.53$ -$ 0.0% 2.44$ 54.8 99,140$ SAP SAP SE 118.75$ 1.19$ 1.0% 5.43$ 21.9 141,716$ SQ Square, Inc. 61.78$ -$ 0.0% 0.60$ 103.0 24,861$ TSM Taiwan Semiconductor Manufacturing Co., Ltd. 38.93$ 0.92$ 2.4% 2.50$ 15.6 201,894$ TXN Texas Instruments Incorporated 115.74$ 2.48$ 2.1% 5.70$ 20.3 113,300$ TYL Tyler Technologies, Inc. 231.70$ -$ 0.0% 5.06$ 45.8 8,871$ ULTI The Ultimate Software Group, Inc. 264.60$ -$ 0.0% 5.97$ 44.3 8,100$ OLED Universal Display Corp. 96.65$ 0.24$ 0.2% 2.69$ 35.9 4,551$ V Visa, Inc. 134.74$ 0.84$ 0.6% 5.02$ 26.8 301,661$ WEX WEX, Inc. 188.01$ -$ 0.0% 8.54$ 22.0 8,100$ WNS WNS (Holdings) Ltd. 53.00$ -$ 0.0% 2.39$ 22.1 2,673$ Back to first page

Information Technology, cont…

12

MaterialsMarch 26, 2018

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APD Air Products & Chemicals, Inc. 168.51$ 4.40$ 2.6% 7.89$ 21.4 36,936$ DWDP DowDuPont, Inc. 69.49$ 1.52$ 2.2% 4.49$ 15.5 161,272$ ECL Ecolab, Inc. 146.19$ 1.64$ 1.1% 5.66$ 25.8 42,179$ FMC FMC Corp. 88.64$ 0.66$ 0.7% 6.42$ 13.8 11,923$ LYB LyondellBasell Industries NV 118.09$ 4.00$ 3.4% 11.09$ 10.7 46,299$ PKG Packaging Corp. of America 122.64$ 3.16$ 2.6% 8.31$ 14.8 11,571$ PPG PPG Industries, Inc. 104.15$ 1.80$ 1.7% 6.71$ 15.5 25,967$ PX Praxair, Inc. 159.83$ 3.30$ 2.1% 7.04$ 22.7 45,930$ SHW The Sherwin-Williams Co. 398.05$ 3.44$ 0.9% 20.21$ 19.7 37,236$

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2017 was the year of the merger in the materials space, with multiple significant transactions in each of the diversified, specialty, and agricultural sub-sectors within chemicals coming to fruition. Investors have generally responded favorably to the heightened deal activity over the last two years and there are well-defined pipelines of synergies that should support earnings growth for many in the sector into 2018. Commodity prices have also bounced off their 2016 lows, although production results and market sentiment continue to fluctuate based on government policies (i.e. resource taxes in emerging markets, Chinese capacity rationalization, potential U.S. steel tariffs). Global industrial production trends remain increasingly favorable and we expect broad-based demand for materials to be solid in the near term. However, we see pricing continuing to remain volatile for most commodities given limited visibility in China and an uncertain global monetary policy outlook. We continue to favor the chemicals sector within materials into 2018 as we see heightened M&A activity in recent years driving increased industry consolidation, company-specific synergies, as well as upgraded (i.e. higher margin) portfolios of assets. We also see chemicals benefiting from a solid global industrial production backdrop which should drive relatively stable low single underlying digit volume growth. – Larry Pfeffer, CFA, Equity Sector Analyst

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Real EstateMarch 26, 2018

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ADC Agree Realty Corporation 53.32$ 2.16$ 4.1% 2.91$ 18.3 1,655$ AMT American Tower Corporation 138.58$ 3.08$ 2.2% 7.66$ 18.1 61,205$ CHSP Chesapeake Lodging Trust 32.18$ 1.60$ 5.0% 2.07$ 15.6 1,943$ CCI Crown Castle International Corp 103.04$ 4.20$ 4.1% 5.71$ 18.0 42,743$ EDR Education Realty Trust, Inc. 39.88$ 1.56$ 3.9% 1.75$ 22.8 3,023$ FRT Federal Realty Investment Trust 120.86$ 4.00$ 3.3% 5.16$ 23.4 8,849$ LAMR Lamar Advertising Company Class A 72.58$ 3.64$ 5.0% 5.41$ 13.4 7,146$ PSA Public Storage 216.55$ 8.00$ 3.7% 10.13$ 21.4 37,729$ O Realty Income Corporation 53.27$ 2.63$ 4.9% 3.24$ 16.5 15,149$ SBAC SBA Communications Corp. Class A 157.32$ -$ 0.0% 8.02$ 19.6 18,121$ SPG Simon Property Group, Inc. 165.38$ 7.55$ 4.6% 11.09$ 14.9 51,218$ STAG STAG Industrial, Inc. 26.97$ 1.42$ 5.3% 1.68$ 16.1 2,622$ SUI Sun Communities, Inc. 96.89$ 2.84$ 2.9% 4.28$ 22.6 7,760$ WELL Welltower, Inc. 57.99$ 3.48$ 6.0% 3.76$ 15.4 21,571$

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Real Estate Investment Trust (REIT) fundamentals remain solid and valuations are generally reasonable. Property owners in most sectors seem to have regained pricing power as occupancies are near historic highs and we expect lease rates to continue to increase across most asset classes. We believe commercial real estate is well into a broad-based recovery as commercial property prices are near record highs. Demand for U.S. real estate is healthy; however, demand for most sectors can be economically sensitive and will hinge on the performance of the broader economy. New supply has largely been held in check; however, we expect new construction to gain traction as the economics of new development have become more favorable for certain asset classes, including multi-family and senior housing. For many of the public equity REITs, we expect property sales to continue given that private market transactional values are approaching peak levels for high quality (A) properties. However, certain companies remain active buyers given that capital remains available and generally attractively priced for most REITs. Wells Fargo Investment Institute believes that valuations are generally reasonable and investors should even-weight the group. Income oriented investors favor this sector given their above average overall dividend yield of approximately 4.4% as of May 31, 2018 as measured by the FTSE NAREIT Equity REIT Index. We recommend investors focus on REITs in property sectors that are expected to generate strong earnings growth, such as cell towers and industrial properties. Additionally, should economic growth and inflation accelerate from current levels, sectors with shorter lease durations (such as self-storage, residential, and hotel) may provide stronger returns. There are special risks associated with an investment in real estate, including the possible illiquidity of the underlying properties, credit risk, interest rate fluctuations and the impact of varied economic conditions. -- John Sheehan, CFA, Equity Sector Analyst

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Telecommunications ServicesMarch 26, 2018

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T AT&T, Inc. 33.83$ 2.00$ 5.9% 3.41$ 9.9 207,750$ CHL China Mobile Ltd. 45.82$ 2.56$ 5.6% 4.49$ 10.2 187,637$ CCOI Cogent Communications Holdings, Inc. 51.75$ 2.08$ 4.0% 0.86$ 59.8 2,396$ TEF Telefónica SA 8.95$ 0.37$ 4.1% 0.88$ 10.1 45,882$ VZ Verizon Communications, Inc. 49.18$ 2.36$ 4.8% 4.61$ 10.7 203,207$ VOD Vodafone Group Plc 25.21$ 1.79$ 7.1% 1.39$ 18.2 67,252$ ZAYO Zayo Group Holdings, Inc. 36.29$ -$ 0.0% 0.49$ 73.4 9,020$

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The Telecom sector was the worst performing sector in 2017 and ended the year in negative territory from a total return perspective. High-level sector drivers have been mixed as interest rates have remained relatively stable and favorable regulatory developments out of Washington D.C. have been overshadowed by increasingly aggressive promotions in the wireless industry. As a reminder, newly-appointed Federal Communications Commission (FCC) chairman Ajit Pai has historically been an advocate for lower levels of regulation and is expected to unwind some recently-enacted rules (Net Neutrality is an example). Somewhat offsetting positive regulatory developments is heightened competition in the wireless industry. Verizon, and soon thereafter AT&T, recently rolled out unlimited data plans to defend market share from T-Mobile and Sprint. As wireless data consumption continues to climb, we believe unlimited data plans will weigh on margins as network spending will have to keep pace with traffic demands. We continue to view the large, diverse carriers as appropriate as the cornerstone of an investor’s Telecom exposure and view the tower companies as attractive alternatives for higher-growth accounts with less emphasis on income. We like the large carriers’ attractive dividend yields, diverse revenue sources (and therefore ability to potentially weather periods of heightened wireless competition) and relatively stable total return profiles. We like the towers as a carrier and at times geographically-agnostic means to participate in the robust expected growth in mobile data consumption. – Joe Buffa, Equity Sector Analyst

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UtilitiesMarch 26, 2018

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AWK American Water Works Co., Inc. 79.28$ 1.82$ 2.3% 3.40$ 23.3 14,116$ D Dominion Energy, Inc. 62.60$ 3.34$ 5.3% 4.14$ 15.1 40,850$ DUK Duke Energy Corp. 73.12$ 3.56$ 4.9% 4.83$ 15.2 51,258$ ETR Entergy Corp. 76.89$ 3.56$ 4.6% 6.13$ 12.5 14,923$ ES Eversource Energy 53.56$ 2.02$ 3.8% 3.35$ 16.0 16,972$ FTS Fortis, Inc. 31.49$ 1.35$ 4.3% 2.58$ 12.2 13,265$ NGG National Grid Plc 55.56$ 3.05$ 5.5% 3.93$ 14.1 37,298$ NJR New Jersey Resources Corp. 40.80$ 1.09$ 2.7% 2.19$ 18.6 3,580$ NEE NextEra Energy, Inc. 156.80$ 4.44$ 2.8% 8.02$ 19.6 73,921$ PNW Pinnacle West Capital Corp. 74.40$ 2.78$ 3.7% 4.57$ 16.3 8,328$ SO The Southern Co. 43.28$ 2.40$ 5.5% 2.95$ 14.6 43,783$ WEC WEC Energy Group, Inc. 59.46$ 2.21$ 3.7% 3.38$ 17.6 18,762$ XEL Xcel Energy, Inc. 42.69$ 1.52$ 3.6% 2.50$ 17.1 21,723$

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The Utilities sector performed well through the first eleven months of 2017 before falling out of favor in December as the sector is generally not viewed as a beneficiary of tax reform. We believe interest rate expectations will be one of the top drivers of Utilities sector sentiment as we move through 2018 and the market anticipates timing of Federal Reserve rate increases. In our view, the risk is skewed to the downside for utilities given elevated valuation levels. M&A activity will potentially remain a factor in 2018 as we expect gas roll-ups to continue given their attractive growth profiles and long capital expenditure backlogs. We recommend investors focus Utilities sector exposure on primarily regulated names with the potential for above average dividend growth. The rationale behind the “primarily” qualifier is that often times, outsized dividend growth potential stems at least partially from unregulated operations. From our perspective, the relatively reliable nature of regulated operations should provide the core of a Utilities sector recommendation while the riskier unregulated piece should provide enhanced growth. Within this framework, we see opportunities in select electric and multi-utilities with a preference for those at the lower end of the sector’s valuation spectrum, but caution against simply choosing the “cheapest” stocks in the sector without first understanding the issues surrounding each company. We are less favorable on water and gas utilities given current multiples and yields relative to historical levels. * Dividends can be increased, decreased or totally eliminated at any point without notice. -- Joe Buffa, Equity Sector Analyst

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Definitions

ASG List Descriptions:

IMPORTANT DISCLOSURES

Estimated NTM EPS: Street consensus earnings per share estimate for the next 12 months. For REITs we use adjusted funds from operations (AFFO).

NTM P/E: Price to earnings ratio based on the next 12 months EPS.

Market Cap: The company's market capitaliation.

The Core List Strategy is comprised of blue chip, industry-leading companies that we believe can withstand the test of time. The objective is to provide a list of high-quality stocks that can be used to build a well-diversified portfolio or can be used to supplement an existing portfolio.

The DSIP List Strategy (Diversified Stock Income Plan List) focuses on companies that we believe will provide consistent annual dividend growth over a long-term investment horizon. Our objective is to provide a broad list of high quality, industry leading companies from which an investor can assemble a well-diversified portfolio. Through consistent dividend growth, our goal is to help investors stay ahead of the wealth eroding effects of inflation.

St. Louis, MO 63103 Or call by phone: (888)-410-9203 Please remember to specify the issuer(s) with respect to which you would like to receive disclosure information.

For important disclosure information, please contact:

The Small and Mid-Cap List Strategy (SMID List) includes stocks representing companies with market capitalization ranging from $1.0 to $12.5 billion from across the Global Industry Classification Standard (GICS) sectors. Our objective is to exceed the total return of the S&P 1000 over a minimum one-year time horizon.

The Value Equity List Strategy (Value List) focuses on companies that we believe are trading below their underlying intrinsic value and have the potential to reduce or elminate this valuation discount. Our objective is to provide investors a list of stocks that may generate attractive returns as the stock price approaches what we believe to be the underlying value of the company.

The Dynamic Growth Equity List Strategy focuses on companies that we believe offer above average growth potential and may be on track to become leaders in the markets they serve. Our objective is to offer investors a list of stocks that they can use to help build a well-diversified portfolio or to fill holes in an existing portfolio.

The Focus List Strategy includes 25 stocks and represents a combination of the equity sector guidance from Wells Fargo Investment Institute and security selection from our Wells Fargo Advisors Equity Sector Analysts. The objective is to exceed the total return of the S&P 500 over an approximate one-year timeframe.

The High Yield Equity Income List Strategy seeks to emphasize companies with notably higher dividend yields than the broader market (as measured by the S&P 500). Our objective is to offer a list of stocks for investors seeking a higher level of income and willing to accept a higher level of risk.

Disclosure Information

Wells Fargo Advisors, Attn: Advisory Services (Disclosure Information)

The International Equity List Strategy is designed to provide exposure to non-U.S. domiciled companies. While flexible, the strategy leans toward large, well-known industry leaders with global operations. We envision this strategy complementing an otherwise domestic equity portfolio with an investing horizon of three to five years. In our view,

ANALYST CERTIFICATION: The Analyst who prepared this report hereby certifies that the views expressed in this report accurately reflect his/her personal views about the subject companies and their securities. The Analyst also certifies that he/she has not been, is not, and will not be receiving direct or indirect compensation for expressing the specific recommendation(s) or view(s) in this report.

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Disclaimers

You should be aware that investments can fluctuate in price, value and/or income, and you may get back less than you invested. We recommend that existing shareholders consider their objectives, their risk tolerance, and the size of their positions relative to their portfolios when evaluating their holdings.

There is no assurance that any of the target prices mentioned will be attained. Any market prices are only indications of market values and are subject to change.

Exposure to the commodities markets subject an investment to greater share price volatility than an investment in traditional equity or debt securities. Products that invest in commodities may employ more complex strategies which may expose investors to additional risks.

S&P 500 Index is a market capitalization-weighted index composed of 500 widely held common stocks that is generally considered representative of the US stock market.

The prices of small and mid-cap company stocks are generally more volatile than large company stocks. They often involve higher risks because smaller companies may lack the management expertise, financial resources, product diversification and competitive strengths to endure adverse economic conditions.

Investments in currencies involve certain risks, including credit risk, interest rate fluctuations, fluctuations in currency exchange rates, derivative investment risk and the effect of political and economic conditions.

Investments in the energy sector are subject to the adverse economic events within that industry. A downturn in the energy sector of the economy, adverse political, legislative or regulatory developments or other events could have a large impact on a portfolio’s investments in this sector.

American depositary receipt (ADR) is a stock that trades in the United States but represents a specified number of shares in a foreign corporation. ADRs are bought and sold on American markets just like regular stocks, and are issued/sponsored in the U.S. by a bank or brokerage. If the home currency is devalued, this can result in a loss to the ADR holder, even if the company had been performing well. Due to currency exchange rate fluctuations, dividends can also vary significantly period to period. For example, a company may increase its dividend on a euro basis, but U.S. ADR holders may see their dividend decrease. Bear in mind that outside the U.S., the attitude toward dividends is different.

Investment in Master Limited Partnerships (MLPs) involves certain risks which differ from an investment in the securities of a corporation. MLPs may be sensitive to price changes in oil, natural gas, etc., regulatory risk, and rising interest rates. A change in the current tax law regarding MLPs could result in the MLP being treated as a corporation for federal income tax purposes which would reduce the amount of cash flows distributed by the MLP. Other risks include the volatility associated with the use of leverage; volatility of the commodities markets; market risks; supply and demand; natural and man-made catastrophes; competition; liquidity; market price discount from Net Asset Value and other material risks.

Investing in foreign securities presents certain risks not associated with domestic investments, such as currency fluctuation, political and economic instability, and different accounting standards. This may result in greater share price volatility. These risks are heightened in emerging markets.

Dividends are not guaranteed and are subject to change or elimination.

Investments that are concentrated in a specific sector, industry, country or commodity increases its vulnerability to any economic, political, currency or regulatory development, which may result in greater price volatility.

An index is not managed and is unavailable for direct investment.

The suitability of the individual securities should be reviewed by investors and their Wells Fargo Advisors Financial Advisor to determine whether a particular security is suitable for their portfolios, with full consideration given to existing portfolio holdings.

FTSE NAREIT Equity REIT Index is a market-capitalization-weighted index of all publicly traded REITs that invest predominantly in the equity ownership of real estate. The index is designed to reflect the performance of all publicly traded equity REITs as a whole.

Business Development Company or Registered Investment Company (BDC/RIC) is a type of closed-end mutual fund designed to lend to private middle-market businesses. The BDC/RIC model was created in 1980, when Congress modified the 1940 Investment Company Act to facilitate private finance investment.

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©2018 Wells Fargo Clearing Services, LLC. All rights reserved.

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The Advisory Services Group (ASG) of Wells Fargo Advisors works with information received from various resources including, but not limited to, research from affiliated and unaffiliated research correspondents as well as other sources. ASG does not assign ratings to or project target prices for any of the securities mentioned in this report.

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Additional information available upon request. Past performance is not a guide to future performance. The material contained herein has been prepared from sources and data we believe to be reliable but we make no guarantee as to its accuracy or completeness. Any opinions, prices or estimates contained in this report is as of the date of this publication and is subject to change without notice. This material is published solely for informational purposes and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or investment product. Opinions and estimates are as of a certain date and subject to change without notice.

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Wells Fargo Investment Institute, Inc. is a registered investment adviser and wholly-owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company.

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

Wells Fargo Advisors publishes several theme-based lists of recommended equity securities. Each list is based on a specific investment objective and time horizon which may be different from the other lists. This may cause Wells Fargo Advisors to recommend an equity security to be added to one list and removed from another list. Thus, one list may contain different recommendations or conclusions that could result in short-term price movements contrary to the recommendations in another list.