ANALYST of the year
The role of the analyst has become increasingly important at such an uncertain time in the economy, when everyone is looking for guidance.
With the UK retail sector in turmoil over the decline of Sainsbury’s, Morrison’s, Waitrose and especially Tesco – caused mainly by the rise of the German discounters – their views have never been needed more.
The pharmaceutical sector has seen its fair share of upheaval, too, with Pfizer’s’ bids for AstraZeneca and Abbvie’s takeover of Shire.
This category’s nominees all stand out for their impressive foresight in their respective sectors and their revered reputations in the industry.
Here is our pick of the analysts truly at the top of their game.
AND THE NOMINEES ARE…
TOMORROW: BANK OF THE YEAR
Neophytou,the pharmaceuticals analyst at Panmure Gordon, is the go-to man in the sector. Neophytou has led the coverage of the major stories this year, including Abbvie’s takeover of Shire and GlaxoSmithKline’s tie in with Novartis. Neophytou was spot on when he said that Abbvie’s final price would be “greater than £51.15 but not higher than £55” per share – it eventually went for £53 a share. On GSK’s almost £10bn tie up with Novartis, he said that it would “show management will not sit idly by waiting for the pipeline to mature but will take brave decisions to unlock shareholder value”.
The retail analyst at HSBC has been most outspoken on the turmoil in the retail sector. McCarthy has covered the supermarket price wars over the past year, especially after the rise of Aldi and Lidl, which have forced the big retailer on to the back foot. But in July, he said that retailers would be better off investing in their core offering “rather than focusing on growing… loss-making online operations”. Just before troubled Tesco’s CEO Philip Clarke was ousted after its market share sank to a 20 year-low – figures he described as “shocking” – McCarthy said: “No retailer has a right to exist and will only endure if it retains a compelling offer,”
Utilities analyst at Liberum Atherton has stood out from others in his field because of his extensive coverage of the high-profile energy debate that has been second only to the arguments over Scottish independence. Like every good analyst, Atherton is not afraid to speak his mind, especially on Labour’s price-freeze policy – which he said would cost the industry £3n-£4bn a year. As he told City A.M: “Price controls are one of the most disruptive actions a government could take and it is hard to believe that Labour have thought this through.”
The defence analyst at Canaccord Genuity, Keyworth has called correctly on a number of issues, based on US budgetary decline for both core and Overseas Contingency Operations (OCO) spend. Most notable is her underweight stance on the macro outlook for the defence industry, which she took even as profits were increasing. She saw that a lot of work had been pulled forward and that the downturn was likely to last longer than companies expected. She predicts further downgrades even amid increased global political tension. Her best call was a “sell” note on troubled defence contractor Chemring, whose shares fell following interims and a change of chief exec.
Whittaker, Liberum’s lead analyst for the media sector, which he has covered for over 10 years, has been particularly ahead of the game on the resurgence of integrated producer and broadcaster ITV. After Liberty bought a stake in the firm, he said it would make a “whole lot of sense” if ITV were to be bought out, “because ITV is fundamentally a very sound company… [because it is] the only way in the UK to reach a mass TV audience.”
Other media analysts are now scrabbling to follow suit. He has also praised Reed Elsevier’s improvements,and called a “sell” on Financial Times-owner Pearson after a US sales slump.