EXITED STERICYCLE AT $71.40 (SRCL-US)

Stericycle is a compliance company that specializes in collecting and disposing regulated substances, such as medical waste and sharps, pharmaceuticals, hazardous waste, and providing services for recalled and expired goods.

JUSTIFICATION We added a half position in SRCL in December 2015 at $116.55 on the expectation that earnings would continue to grow following the acquisition of SHRED-IT. Unfortunately, earnings suffered and the PE multiple dropped from its norm of 22X to 16X which had a negative effect on the stock price. This company may eventually recover, but we are increasingly concerned about the deteriorating profit outlook for the company and the possibility of a corrective phase in the market, therefore we believe that it is best to exit this position and stand by.