The buy side says: “Paul understands what drives earnings.”
Paul Cheng, who rises from No. 2 to claim first-place honors for the first time, “is always accessible — he calls me back whenever I need a quick answer,” says one portfolio manager. Last October the Barclays Capital researcher underscored his sell rating on refinery stocks, including Alon USA Energy of Dallas, at $9.30, and San Antonio–based Tesoro Corp., at $16.18, on the belief that the companies’ profits would be squeezed because, even though emerging-markets countries had not fully developed their refining capabilities, global supply would continue to outpace demand. Since the reiteration the stocks had fallen 41.7 and 30.6 percent, respectively, to $5.42 and $11.23, by the end of August. During the same period the sector declined 12.5 percent. One long-time client says he’s grateful that the analyst “kept me out of the refining sector for the past couple of years.” Cheng, 46, earned an MBA in finance and international business at New York University Stern School of Business in 1988 and worked at Kidder, Peabody & Co. before joining Lehman Brothers in 1994. Barclays acquired the North American operations of Lehman Brothers Holdings in September 2008.
