second team Douglas Harned Sanford C. Bernstein
third team Ronald Epstein BofA Merrill Lynch
Jumping two spots to claim first-place honors for the first time is Joseph Nadol. Clients praise the J.P. Morgan analyst for his abilities to “think on his own” and “smell management B.S. a mile away.” Nadol, 37, downgraded Harris Corp. from neutral to underweight in March, at $35.22, on declining sales at the Melbourne, Florida–based provider of tactical radios for the defense industry. In May, after the shares had slid 16.4 percent, to $29.45, Nadol upgraded them to neutral, on valuation. The price then rose 17.9 percent, compared with 11.5 percent for the sector, through August. Nadol earned a bachelor’s degree in government from Harvard University in 1995 before joining Donaldson, Lufkin & Jenrette as a real estate analyst; he moved to J.P. Morgan in 2001.
Douglas Harned slips a notch to No. 2. In December the Sanford C. Bernstein & Co. analyst downgraded Boeing Co. from outperform to market-perform, predicting further delays in the Chicago-based aircraft manufacturer’s highly touted 787 Dreamliner. Harned stuck to his guns even as the stock continued to rise (although the shares were dragged down with the rest of the market from February into early March), and in June a company announcement that the Dreamliner would be delayed sent the share price tumbling. By August 31, Boeing’s stock was ahead of the sector by only 3.4 percentage points since Harned’s downgrade. “If I had to rely on only one source, Doug would be the one,” insists one supporter.
BofA Merrill’s Ronald Epstein debuts at third, in part because of what one client calls his “willingness to step outside of consensus.” Case in point: In April, Epstein issued a contrarian buy recommendation on General Dynamics Corp., calling shares of the Falls Church, Virginia–based defense contractor a bargain at $49.18. The stock had risen 20.4 percent, to $59.19, by the end of August.
Click here to see the All-America Research Team rankings.