Institutional Investor All American Research Team | Page 2

60/research & rankings THE FUTURIST THE CHARTIST CONTENTS INSIDE II O

DE II OPENING CAPITAL THE 2012 ALL-AMERICA RESEARCH TEAM INVESTING RESEARCH & RANKINGS THE FUTURIST THE CHARTIST CONTEAM INVESTING

pointing earnings caused the
carton producer’s shares to slip
to $49.91. The stock had
jumped 33.8 percent, to $66.77,
by late August. Staphos “is not
easily swayed by short-term
trends — he doesn’t overreact,”
affirms another ally. — B.M.

end of August. Nadol, who has
a coverage universe of 20 stocks,
currently favors United Technologies Corp., the Hartford,
Connecticut–based aerospace
giant, for the benefits of its July
acquisition of Goodrich Corp.
and growing demand in the aerospace aftermarket.
— B.M.

CAPITAL GOODS/
INDUSTRIALS

AIRFREIGHT & SURFACE
TRANSPORTATION
AEROSPACE & DEFENSE
EL ECTRONICS

Joseph Nadol
J.P. Morgan
The buy side says:
“He’s the most knowledgeable
analyst in the space.”

F

or a fourth year running,
J.P. Morgan’s Joseph
Nadol captures the crown.
The 40-year-old stands out for
his January upgrade of Exelis
from neutral to overweight.
Dubbing the shares a bargain at
$9.16, he cited the McLean,
Virginia–based supplier of hightech defense gear’s high dividend yield and a likely rise in
sales of its electronic jammers,
radios and night-vision goggles. In early April, when the
stock had climbed 30.9 percent, to $11.99, and led the
sector by 26.3 percentage
points, he downgraded it to
neutral, primarily on valuation.
The following month the company reported a year-over-year
first-quarter revenue gain of
6 percent, to $1.4 billion, but
affirmed its guidance that fullyear revenues would decrease
7 percent, to $5.5 billion. Exelis’
shares had slid to $10.10 by the

William Greene Jr.

October 2011 he initiated
coverage on Old Dominion
Freight Line with an overweight
rating, at $30.48, owing to its
earnings growth, successful
cost-slashing effort, stable balance sheet and attractive valuation.The Thomasville, North
Carolina–based shipper’s stock
had chugged to $44.78 by late
August, for a gain of 46.9 percent that sped past the sector
by 38.1 percentage points. “Bill
draws thoughtful conclusions
while most other analysts simply tell you what you already
know,” explains one buy-side
backer. Greene, 43, joined
Morgan Stanley in 1998 from
Salomon Brothers; he holds a
bachelor’s degree in economics from Ithaca, New York’s
Cornell University. — B.M.

the tax benefits of management’s proposal to restructure
as a real estate investment
trust. In June, when the company did apply for REIT status,
the stock sank to $27.19, but
Steinerman held his ground.
Sure enough, by late August
shares of the Boston-based
records keeper had rallied to
$32.80 — up 13.2 percent and
ahead of the sector by more
than 15 percentage points since
the reiteration. Steinerman,
44, follows 27 companies and
recently added coverage of
Nielsen Holdings, a media
analytics outfit based in the
Netherlands, which offers
“defensive growth at an attractive valuation,” he says. — B.M.

supplier of industrial electronics
soared 52 percent, to $80.82,
and led the sector by 31 percentage points, through August.
Davis also restarted coverage of
Ireland’s Cooper Industries in
October 2011 with an overweight rating, at $49.42, dubbing the maker of electronic
tools a likely takeover target.
In May industrial manufacturer Eaton Corp. of Cleveland
announced plans to acquire
Cooper, and by late August the
stock had bolted 48 percent,
to $73.15, and bested the sector by 28.7 percentage points.
The deal is expected to close
later this year.
— B.M.

year is a deal to build a gas-toliquids facility for Petróleo
Brasileiro, or Petrobras. The
stock surged 19 percent, from
$18.40 to $21.90, and outpaced
the sector by 7.3 percentage
points, through August. The
analyst currently favors Fluor
Corp., on valuation, particularly
after a recent jump in petroleum
refinery bookings for the Irving,
Texas–based engineering services provider. Kaplowitz, 39,
“has a good grasp of the fundamental drivers, down to the
project-by-project level,” marvels another devotee. — B.M.

Morgan Stanley
The buy side says:
“Bill is very responsive and
always ready to help.”

W

illiam Greene Jr.
debuted as a runner-up
in 2009 and has climbed one
rung every year since, finally
reaching the top this year; the
Morgan Stanley analyst also
ranks third in Airlines. Greene
covers 42 companies across
both sectors and has “a good
sense of how every stock
behaves in the market, beyond
the fundamentals,” as one portfolio manager puts it. In

WILLIAM
GREENE JR.
HAS “A
GOOD
SENSE OF
HOW EVERY
STOCK
BEHA
VES.”

I N S T I T U T I O N A L I N V E S T O R . C O M • O C T O B E R 2 012

MACHINERY
ENGINEERING & CONSTRUCTION
ELECTRICAL EQUIPMENT
& MULTI-INDUSTRY
BUSINESS, EDUCATION
& PROFESSIONAL SERVICES

Andrew Steinerman
J.P. Morgan
The buy side says:
“He has the experience you can
trust. Why go anywhere else?”

W

ith this year’s first-place
finish — his eighth in a
row and tenth overall — J.P.
Morgan’s Andrew Steinerman
joins the All-America Research
Team Hall of Fame. Clients
praise Steinerman for his “topnotch management contacts”
and “long history of covering
the sector,” attributes that
enable him to be “invariably
ahead of the curve.” In April
the analyst highlighted his
long-standing overweight on
Iron Mountain, at $28.98, on

Andrew Kaplowitz
Barclays

Barclays

The buy side says:
“Andy is extremely thorough, and
he is very helpful to buy-siders.”

The buy side says:
“Scott is insightful, and he
doesn’t mince words.”

F

Scott Davis

S

cott Davis, who moved
from Morgan Stanley to
Barclays in September 2011,
reclaims the pole position after
a year in second place. “He
knows his companies extremely
well and does a great job of
communicating with the buy
side,” says one enthusiast. The
44-year-old, who tracks two
dozen companies, relaunched
coverage of Hubbell in October
2011 with an overweight rating,
at $53.17, citing its rising greentechnology retrofit business
and low debt load. Shares of the
Shelton, Connecticut–based

or a fourth year running,
Barclays’s Andrew
Kaplowitz is No. 1; he also
claims a runner-up position in
Machinery. Kaplowitz covers
24 companies across the two
sectors and is appreciated for
“keeping us up-to-date on any
new information he has gathered in his fieldwork,” according to one portfolio manager.
Case in point: a September
2011 report reiterating his overweight on perennial favorite
Foster Wheeler, a diversified
industrial concern headquartered in Geneva, on a likely
pickup in business. The company has announced that
among its new contracts this

David Raso
ISI Group
The buy side says:
“David is by far the most thorough
and technically sound analyst
in the machinery sector.”

I

SI Group’s David Raso, 42,
extends his winning stre ak to
a 12th year. The All-America
Research Team Hall of Famer
“digs deeper, runs harder and
has more thorough knowledge
than anyone else,” declares one
booster. “There must be 27
hours in his day.” Raso, who
tracks 15 stocks, downgraded
Deere & Co. from buy to hold
in February, at $87.37 — just
11 days and $0.65 shy of its
12-month peak — largely on valuation. Shares of the Moline,
Illinois–based tractor maker,
which Raso had rated a buy since
December 2008, tumbled to
$70.16 in June before rising to
$75.11 by late August, for a lifeof-call loss of 14 percent. During

DA
VID RASO
“DIGS
DEEPER,
RUNS
HARDER
THAN
ANYONE
ELSE.”
the same period the sector fell by
13.3 percent. In August, Raso
reduced Ireland’s Ingersoll-Rand
— another stock he had been
recommending since 2008 —
from buy to hold, on valuation.
By that time the shares had skyrocketed more than 204 percent, from $13.79 to $41.96.
The downgrade might have
been premature, however; the
stock had climbed to $46.76 by
the end of that month. “David
has the best global machinery
contacts in the world and tirelessly travels the globe in search
of inflection points,” proclaims
another fan.
— B.M.

try is finally being run like a real
business, as opposed to a
hobby,” the 44-year-old
observes. “Over time we expect
share prices to reflect increasing
earnings stability.” Baker’s top
pick is Atlanta-based Delta Air
Lines, where an “unemotional”
executive team “is focused on
repairing its balance sheet and
achieving sustained returns on
capital,” he says. Delta’s stock
was trading at $8.65 in late
August; Baker has a target price
of $17.50. He is also bullish on
United Continental Holdings,
even though the Chicago-based
carrier’s shares lost nearly one
quarter of their value in July.
“United is being punished for
its industry-lagging profit margins,” the analyst explains. “But
the majority of its problems
appear self-inflicted, and we
tend to gravitate toward names
where management has the
ability to address deficiencies —
as opposed to fuel or demand
issues, which are outside their
control.” At the end of August,
United’s stock stood at $18.45;
Baker’s target price is $29. “His
calls are very timely,” attests
one backer. — Paul Sweeney

CONSUMER

APPAREL, FOOTWEAR & TEXTILES

Omar Saad

AIRLINES

Jamie Baker
J.P. Morgan
The buy side says:
“Jamie is the best stock picker
in the group.”

J

.P. Morgan’s Jamie Baker
soars to the summit for a
fifth year in a row. “The indus-

ISI Group
The buy side says:
“His work is very different from
every other analyst’s.”

U

nranked last year, Omar
Saad shoots straight to first
place; the ISI Group analyst
also nabs a runner-up spot in
Retailing/Specialty Stores. “He

O C T O B E R 2 012 • I N S T I T U T I O N A L I N V E S T O R . C O M