Michael Goldstein | Michael Goldstein Empirical SECOND TEAM Keith Miller Citi THIRD TEAM Pankaj Patel Credit Suisse RUNNERS-UP François Trahan ISI |
Michael Goldstein of Empirical Research Partners, on top for a second consecutive year, “is the best and has been the best for a long, long time,” declares one impressed investor. The 53-year-old analyst, who is also No. 2 in Portfolio Strategy, published a report in July advising investors that oil and gas exploration and production shares were overpriced because “the market is paying for reserves and perhaps including a premium for E&P stocks for the possibility of acquisition,” and that oil services companies were a more attractive alternative. E&P stocks had trailed oil services stocks by 8.3 percentage points through mid-September. Keith Miller of Citi climbs one rung to second place. “Miller’s work is thorough and comprehensive — more important, he thinks like an investor,” asserts one satisfied client. Using a proprietary S&P 500 Industry Group Rotation Model to predict outperformance on the basis of return on equity, prior six-month total return, historical relative earnings to price and historical relative cash flow to price, Miller downgraded semiconductor and semiconductor capital equipment companies to underperform in January. By mid-September they had lagged the broad market by 5.3 percentage points. Unranked last year, Pankaj Patel of Credit Suisse finishes third. In January, Patel predicted that, owing to their attractive valuation levels, growth stocks would continue to outperform relatively pricier value stocks, although the spread would not be as wide as last year’s 7.8 percentage point margin. As of mid-September growth stocks had outpaced value by 2.9 percentage points. “His research cuts through a lot of the noise in the quant world, focusing on factors that really matter in the long run,” says one buy-side enthusiast.
