THIRD TEAM

Simon Flannery  Morgan Stanley

Although he drops from first to third, Morgan Stanley’s Simon Flannery maintains a loyal base: “His recommendations, based on fundamentals rather than momentum, serve investors with a long-term horizon best,” observes one advocate. Flannery advised clients to buy San Antonio’s Rackspace Hosting in August 2010, at $19.56, believing the provider of web-based information-technology systems to be an attractive play on secular growth trends in managed hosting and cloud computing. In November, after the stock had surged 38.3 percent, to $27.05, and led the sector by 29.9 percentage points, he downgraded it to neutral, primarily on valuation. That called proved to be premature, however. The shares kept rising, advancing an additional 35.2 percent, to $36.56, through August.